Sitting of 10 December 1963

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  MALTA

    Constitution (Talks)
    Mr. Hector Hughesasked the Secretary of State for the Colonies if he will make a statement on the constitutional conference on Malta.
    Mr. Stonehouseasked the Secretary of State for the Colonies if he is arranging for new elections in Malta before that country proceeds to independence.
    Mr. Sorensenasked the Secretary of State for the Colonies what conclusions were reached as a result of the consultations he had recently with representatives of the Government and of the Opposition of Malta.
    Mr. Wallasked the Secretary of State for the Colonies if he will make a statement about his discussions with the Maltese political parties.
    The Under-Secretary of State for Commonwealth Relations and for the Colonies (Mr. Nigel Fisher): The talks which my right hon. Friend held last week with the leaders of the political parties of Malta showed that they were unable to resolve their differences on the independence constitution. My right hon. Friend urged them to make a further effort to agree upon some suitable procedure by which the Maltese people could be given the opportunity of stating their opinion; and he asked the Opposition leaders to give careful thought to a proposal by Dr. Borg Olivier for a referendum to be held on the main questions in dispute, which are: what form Malta's future constitution should take and whether new elections should be held before independence. This they undertook to do.
    188
    With permission I will include in the Official Report the text of my right hon. Friend's announcement at the conclusion of the talks and of Dr. Borg Olivier's letter offering a referendum.
    Mr. Hughes: While thanking the Minister for that detailed reply, may I ask whether he realises that the Government's failure to achieve success in the talks that have taken place is very bad, not only for the British Commonwealth and for Malta but for all the peoples concerned? Will he try to take more constructive and effective steps to achieve success, in the interests of the British Commonwealth and the Maltese people?
    Mr. Fisher: If I may say so, the hon. and learned Gentleman is being a little hard. One cannot force people to agree if they do not wish to agree. We hope that this matter will be referred to the Maltese people for their decision.
    Mr. Stonehouse: If there is not general agreement with the proposals, and the Maltese Prime Minister and the opposing parties wish to go forward for new elections, will that find agreement with the Secretary of State?
    Mr. Fisher: Dr. Borg Olivier's proposals are for a referendum in which the people will be asked to decide between his form of constitution and Mr. Mintoff's form of constitution. If all the parties agree to a referendum, that is the way the matter will be decided, but, if they do not agree, my right hon. Friend will have to decide, and this is the last thing he would want to do.
    Mr. Wall: As Malta is not viable, and is unlikely to be viable for some years, is it not very unfair to discuss a constitution for the date of independence until talks have been held on long-term financial aid from Britain to Malta: and when will those talks take place?
    Mr. Fisher: We are ready for financial talks whenever Malta is. Our view is that Malta should not be less generously treated as a result of independence than she has been hitherto.
    Captain Litchfield: What is the urgency for pressing independence on a reluctant Malta?
    Mr. Fisher: The two major parties both said they wanted independence, and both made it part of their policies at the General Election in 1962.
    Mr. Awbery: Is not a referendum likely to cause confusion in the minds of the people of Malta? Would it not be better to have a General Election?
    Mr. Fisher: I always thought that a referendum was a very democratic method, of deciding what people wanted.
    The following is the announcement:
    Proposal for Referendum in Malta
    The Secretary of State for the Colonies, Mr. Duncan Sandys, today, Friday, 6th December, 1963, concluded the consultations which he has been holding in London with the leaders of the Maltese political parties.
    At the final meeting this morning Mr. Sandys made the following statement: "Since the British Government have definitely decided that Malta is to become independent not later than 31st May next, the final form of the Constitution must be settled without further delay. In the light of the views expressed to me by all political parties, I have reluctantly reached the conclusion that there is no likelihood that the differences which exist between them on important constitutional questions will be resolved by further discussion. In these circumstances there remain only two courses open. The first is for the issues to be referred to the people of Malta, either through a referendum or through elections. The second is for the British Government to proceed to take the necessary decisions on their own authority. From every point of view, the first of these courses is much to be preferred. I therefore earnestly trust that the Maltese parties will make a further effort to agree upon some suitable procedure by which the people of Malta can be given the opportunity of stating their opinion."
    At the same time Mr. Sandys read out a letter (text attached) from Dr. Borg Olivier in which the latter offered to hold a referendum on the two main questions in dispute, namely, what form Malta's future Constitution should take and whether new elections should be held before independence.
    The other Maltese leaders undertook to give careful consideration to this new proposal.
    6th December, 1963.
    Letter from the Prime Minister of Malta to the Secretary of State for the Colonies
    6th December, 1963.
    "Dear Secretary of State,
    At the end of the Conference in London last summer, you announced the British Government's decision that Malta should become independent not later than 31st May, 1964. In the light of this definite decision, you invited me to hold discussions in Malta with representatives of all political parties, in
    190
    an endeavour to agree upon joint constitutional proposals; and you suggested that, should we fail to agree, the outstanding issues might be referred for decision either to the people of Malta or to the British Government.
    The further talks in Malta and in London have shown conclusively that the parties cannot agree on the constitutional arrangements for Independence. However, there is general agreement that an imposed solution should, if possible, be avoided. I consider therefore that before accepting this necessity, we should all make a further effort to agree on some procedure by which the people of Malta could be directly consulted on the matters at issue.
    The two main questions on which there is disagreement are:

    (i) whether there should be new elections before Independence; and

    (ii) what should be the form of Malta's future Constitution.

    In order to give the people an opportunity to express their opinion on these two precise questions, I propose that a referendum should be held on the lines indicated in the Annex to this letter. As regards the conditions under which the referendum and any consequential elections would be conducted, I am prepared to give favourable consideration to any arrangements which may be jointly proposed by the opposition parties.
    Failing agreement on this or any other procedure for popular consultation, I shall have no option but to refer the outstanding issues to the British Government for decision.
    Yours sincerely,
    G. BORG OLIVIER."

  ANNEX
  REFERENDUM

  1. Do you want:

  (a) independence without new elections? or

  (b) new elections before independence?

  2. If the majority do not want new elections before independence, do you prefer a constitution on the lines of:

  (a) Draft "A"? or

  (b) Draft "B"?

  Note: Both Questions must be answered.
  Draft "A' is the version of the constitution proposed by the Nationalist Party as printed in the Conference Report.
  Draft "B' is the version incorporating the amendments proposed by the Malta Labour Party.

  Stolper Report
  Mr. Awberyasked the Secretary of State for the Colonies what negotiations have taken place between Her Majesty's Government and the Maltese Government regarding the preparation of plans which will ensure the financial end economic rehabilitation

  191
  and stability of the island after it has received its independence; when a conference on the subject will take place; and when the Stolper Report on this subject will be published.
  Mr. Fisher: The publication of the Stolper Reportis a matter for the United Nations in consultation with the Malta Government. On the remainder of the Question, I have nothing to add to my right hon. Friend's reply to my hon. Friend the Member for Haltemprice (Mr. Wall) on 26th November.
  Mr. Awbery: Is the hon. Gentleman aware that the amount of money to be contributed by this country towards the rehabilitation of Malta is determined, not by the United Nations organisation or by the Maltese Government, but by this Government? He should tell us exactly what he intends to do. The economic position in Malta is due entirely to the action of this Government in withdrawing our men from the naval base. Will the hon. Gentleman do something now in the rehabilitation of Malta?
  Mr. Fisher: The Malta Government are, I understand, bringing forward proposals in the next few weeks based on the Stolper Report, a highly technical study. We are perfectly ready to discuss all the financial arrangements as soon as they do so.
  Mr. Awbery: Will we in this House see the Stolper Report? Will it be placed in the Library? That report arises out of U.N.E.S.C.O., not out of this Government. How are we to get the Stolper Report? The hon. Gentleman tells us that it will be 25 years before Malta is rehabilitated and that this Government will contribute £2 million a year during that period. We should like to know something about that.
  Mr. Fisher: My right hon. Friend has stated before in this House that our intention is that Malta will not be cut off on attaining independence. It will not be either better or worse off as a result of independence. We will look at the Stolper Report and Dr. Borg Olivier's proposals on their merits; and we shall be generous.

  New Factories
  Mr. Awberyasked the Secretary of State for the Colonies what factories have been constructed on the island of Malta during the past two years, how many are contemplated in the near future; how many workpeople have been employed in those completed; and how many will be employed on the completion of those under consideration.
  Mr. Fisher: I am informed by the Malta Government that since January, 1962, 14 factories have been built, two are being constructed and another is planned. Future building will depend on the applications received and the availability of funds. The number of people so far employed in the completed factories is 1,266, but eventually they are expected to employ 4,500. It is estimated that applications under consideration could produce employment for a further 2,800.
  Mr. Awbery: Is the Under-Secretary of State aware that, despite the improvement brought about by the new factories, which are very small indeed, there are 3,000 more unemployed men in Malta today than there were two years ago? What do the Government propose to do to help, because it is impossible for private enterprise to deal with the present situation in Malta?
  Mr. Fisher: The hon. Gentleman keeps on asking the same question. Over the past five years, aid from this country to Malta has averaged £6 million a year. That is quitea lot for one island. With regard to future aid, we shall allocate such funds as we can after having the discussions with the Malta Government which we are waiting to hold. There will be no difficulty about this.

  SEYCHELLES

    Mr. David Joubert
    Mr. Abseasked the Secretary of State for the Colonies why permission was refused to David Joubert, President of the Seychelles Government Workers' Union and employed in the Accountant General's Department of the Seychelles, to attend either on unpaid or paid leave a course at the College of the International Confederation of Free Trade

    193
    Unions at Kampala; and what official salary was earned by Joubert at the time of his request.
    Mr. Fisher: It was not possible to release Mr. Joubert to attend this course when he applied for leave in September because his department at that time was short staffed. At the time of his request his salary was £234 a year.
    Mr. Abse: Is it seriously being suggested that a man who has such a derisory salary, even by the miserable standards in the Seychelles, could not be spared from the department? Is it not appreciated that in an island such as this, where there is considerable exploitation and a great number of problems, it is most desirable that there should be responsible training and leadership? Is it not also appreciated that the course of the kind provided was the sort of thing which would have helped in this respect? Could not the hon. Gentleman consider whether, now that the man goes back, he should be reinstated in his position and given the salary which he has lost as the result of taking this responsible course?
    Mr. Fisher: In a small territory like the Seychelles civil servants cannot expect to be allowed to take leave whenever they wish to do so. I hope that the hon. Member will not mind my saying that in my view the primary purpose of a job is to do it and not to use it as a laboratory to learn about trade unionism. [Hon. Members: "Oh."] Yes, I think so. There is no vacancy for Mr. Joubert as a trade union expert, because the post is already filled by someone better qualified. His reinstatement is a matter for the local Government.
    Mr. G. Thomas: Is the hon. Gentleman aware that Mr. Joubert is a most responsible person? When I visited the Seychelles I formed the opinion that the best thing that could happen to the Seychelles was that training should be given for responsible trade union leaders of his type. Is the hon. Gentleman further aware that there is a feudal atmosphere there which is a disgrace to this House? Will he not look again at the question of the principle of trade unionists attending conferences?
    Mr. Fisher: There is nothing against Mr. Joubet, but there was no possibility of his being employed on his return there on trade union matters because, as I have said, another Seychellois with considerable training in trade union affairs is already employed in the Civil Service in that capacity.
    Mr. G. M. Thomson: Is it not important that public servants in the public service should be given training and experience of responsible trade unionism? Is not that in the interests of the Seychelles? Will not the hon. Gentleman look at this matter again?
    Mr. Fisher: That is very important, but it is also important that the administration of the Seychelles should go on.

    Birth Control
    Mr. Abseasked the Secretary of State for the Colonies whether, in view of the present great increase in population in the Seychelles, and the grants paid to this island by the United Kingdom, he will withdraw the present directive by the medical services of the Seychelles prohibiting instruction of birth control techniques involving contraceptives.
    Mr. Fisher: The directive was issued after it had become clear that instruction by a Government medical officer in birth control techniques involving contraceptives was widely criticised in Seychelles on religious grounds. I am studying the problem further.
    Mr. Abse: Is it appreciated that in this island the rate of illegitimacy last year was 44 per cent.? Would it therefore be noted that it seems highly improbable that there is a large section of the population of the Seychelles who would object on religious grounds? Whatever the views of the Swiss order of priests over there, if there are—as I gathered clearly from my visit—a considerable number of people who want such instruction, will the hon. Gentleman look at this matter again? Will he see that there is freedom for all people, irrespective of their religion, to have what they have a right to have and what the taxpayer in this country, who pays grants in aid for this Colony, has a right to see they get?
    Mr. Fisher: I am personally inclined to agree with the hon. Member that in a territory where there is unemployment and over-population family planning or migration are the only alternatives, but we must bear in mind that 90 per cent. of the people there are Roman Catholics and we must take account of public opinion, whether we agree with it or not.
    Mr. Sorensen: Does the hon. Gentleman appreciate that there is a good deal of religious objection to contraception in this country but we do not allow that to be imposed upon those who wish to practise contraception? In the circumstances, could the hon. Gentleman make it clear to the Government of the Seychelles and to the hospital authorities there that, while no one is compelled to employ contraceptives, those who wish to do so should be at liberty to do so?
    Mr. Fisher: I am inclined to agree, but of course our population is not 90 per cent. Roman Catholic. It is probably the other way about. There are therefore special circumstances, but I am sympathetic and I am asking the Governor to look at the matter again.

  HONG KONG

    Roof-top Dwellers
    Mr. Rankinasked the Secretary of State for the Colonies how many roof top dwellers there were in Hong Kong at the latest convenient date.
    Mr. Fisher: It is estimated that there were about 80,000 in October this year.
    Mr. Rankin: Is the hon. Gentleman aware that in 1956 when I was in Hong Kong the number of roof-top dwellers was 40,000. Is not that increase scandalous? Is the hon. Gentleman aware that the number has doubled in seven years instead of decreasing, as many of us expected? Is he further aware that one of the major caues in retarding housing development in Hong Kong is the absolutely fantastic price of land? Would not the hon. Gentleman try to get the Hong Kong Government to establish some fair system for the regulation of the price of land to help housing development in the island?
    Mr. Fisher: I do not think that this is a scandal at all. One must remember
    196
    that the population of Hong Kong, in an extremely small area, amounts to over 3½ million. Over 1 million Chinese have entered the Colony since the war and more than ½ million have been re-housed in resettlement and low-cost housing estates paid for by the Hong Kong Government in that time. Present plans provide for the housing of 100,000 squatters a year. I think that this is a jolly good record.
    Mr. Rankin: I am perfectly familiar with those figures and I pay respect to what has been done, but is the hon. Gentleman aware that what has been done bears no comparison with what ought to be done? May I ask the hon. Gentleman to look at this problem and at the fantastic prices imposed upon those who want to start public enterprise development in Hong Kong? Could not the hon. Gentleman think of introducing a fairer system?

    Income Tax
    Dr. Brayasked the Secretary of State for the Colonies what is the maximum percentage rate of income tax payable in Hong Kong.
    Mr. Fisher: The maximum rate is 25 per cent, on personal incomes, subject to a provision that the tax charged shall not exceed 12½ per cent. of total assessable income without the deduction of allowances.

    Married Women Government Servants (Equal Pay)
    Dr. Brayasked the Secretary of State for the Colonies when married women Government servants in Hong Kong will be given equal pay
    Mr. Fisher: As the hon. Member is aware, I have asked the Governor to examine further the question of the differences in pay between single and married women Government servants. I am sure that he will do this as quickly as possible.
    Dr. Bray: Is the hon. Gentleman aware that while income tax stands at such a derisory level in Hong Kong neither married women Government civil servants, roof-top dwellers, nor any other of the needy people there can be persuaded that there is not the money available to meet their needs? Will

    197
    the hon. Gentleman take a firmer line with the Hong Kong Government in meeting their responsibilities?
    Mr. Fisher: I sense a difference of approach in this matter. Unlike hon. Members opposite, I think that it is a rather good idea for Governments to have low taxation instead of high taxation. It is not only a question of money. An assessment of priorities must be made. Hong Kong is relatively rich, but no country, however rich, can meet every demand at one and the same time, and housing and schools may have greater priority than Civil Service pay.
    Mr. Paget: How do they pay for housing or anything else at this derisory level of taxation?
    Mr. Fisher: As I am sure the hon. and learned Member well knows, there are special reasons why it is important for Hong Kong to attract investment and enterprise. As the leading trading centre in that part of the world it must attract and retain capital from outside, and therefore I think that the Government's tax ratio is geared to the particular requirements in Hong Kong.

  BECHUANALAND

    Annual Reports
    Mr. Taverneasked the Secretary of State for the Colonies when the annual reports on Bechuanaland for 1961 and 1962 will be published; and if he will ensure the prompt production and publication of such annual reports in future
    Mr. Fisher: A report covering the two years 1961 and 1962 should be ready for publication early next year. Arrangements for the preparation of Bechuanaland reports are being overhauled to ensure much earlier publication in future.
    Mr. Stonehouse: Is the hon. Gentleman aware that not only in Bechuanaland but in many other territories there is great delay in producing these reports? Is this under review as well?
    Mr. Fisher: Yes, it is indeed. I am sorry about this. I have looked into it very carefully. It is hoped that in the future the reports for each year will be available in the Library not more than six months after the end of that year.

  SOLOMON ISLANDS

    Education
    Mr. Godman Irvineasked the Secretary of State for the Colonies what plan has been drawn up for the development of education in the British Solomon Islands; what is the estimated cost; and what action is being taken
    Mr. Fisher: The plan aims to provide 420 places in secondary schools and 4,620 places in designated primary schools. The capital cost is about £780,000 plus a further £260,000 which will be met by the churches and local authorities. The recurrent cast to Government in a full year's working will be about £140,000. I am glad to say that all the churches, to which We are greatly indebted for the development of education in the territory, welcome the plan and all but one of them are prepared to participate in it.
    Mr. Godman Irvine: Is my hon. Friend satisfied that this plan in adequate? In the last figures which were available in 1960, there was a plan which took up £100,000, and this is a considerable improvement, but is my hon. Friend really satisfied that out of a budget of about £1·7 million enough is being spent on education?
    Mr. Fisher: There will be a high priority for education in this next planning period. As to the total amount of money, we must bear in mind that the Territory is grant-aided to the extent of half its budget. In the last CD. & W. period, £239,000 per annum went to the Solomon Islands and in the next the total will be £453,000 per annum. This is a big improvement—it is about double—and expenditure on education will reflect it.
    Mr. Emrys Hughes: Are there any proposals in the education plan for teaching family planning, and what would Solomon have thought of it?
    Mr. Fisher: That has not yet arisen in the Solomon Islands.

  FIJI

    Family Planning (Bums Report)
    Mr. Godman Irvineasked the Secretary of State for the Colonies what steps have been taken in Fiji to implement the recommendations of the Burns Report on family planning
    Mr. Fisher: The Government of Fiji have established a network of family planning clinics and advice is now available at over 50 rural hospitals, as compared with only five when the Burns Report was written. Two delegates went to the Seventh International Planned Parenthood Conference in Singapore this year. A Family Planning Association has been formed and, with Government assistance, this will supply family planning material and propaganda.
    Mr. Godman Irvine: Is my hon. Friend aware that the number of attendances at family planning clinics in Fiji has remained virtually static during the past four years? In view of the importance of this matter in an island such as Fiji, does not my hon. Friend feel that an important programme of attack should be undertaken to deal with the problem?
    Mr. Fisher: I agree with my hon. Friend. We are implementing the Burns Report, and recently the Executive Council decided on a big increase in the amount of publicity devoted to this objective.
    Mr. K. Robinson: Is the Minister aware that an international family planning campaign was recently launched by the Family Planning Association and the International Planned Parenthood Campaign? Is it not incumbent upon Her Majesty's Government to give the maximum co-operation to this campaign not only in Fiji but throughout the Commonwealth?
    Mr. Fisher: I agree with that, and I note what the hon. Gentleman says.

  ADEN

    Deportations
    Mr. R. Edwardsasked the Secretary of State for the Colonies if he is aware that arbitrary deportations are contrary to the Charter of Human Rights, to which Her Majesty's Government subscribes; and what was the number of trade unionists deported from Aden following the recent dispute at the Aden base
    Mr. Fisher: I am aware of the Universal Declaration of Human Rights. I am not aware that any persons have been deported from Aden in circum-
    200
    stances which contravene the provisions of that Declaration. The answer to the second part of the Question is 67.
    Mr. Edwards: Is the hon. Gentleman aware that many of the 67 trade unionists deported were born and bred in Aden, they have never left the Colony before in their lives, and their wives and families have been left in Aden to fend for themselves? Is not this a clear violation of Article 9 of the Declaration of Human Rights? Is he aware, also, that a British trade unionist, who is also a justice of the peace, was refused permission to go to Aden to help these trade unionists to settle their problems? Should not something be done to end the industrial turmoil in Aden?
    Mr. Fisher: I will look into the point which the hon. Gentleman raises about that individual. On the wider question, he is misinformed. Nobody who was born in Aden or even whose father was born in Aden has been deported. Of the 67 people deported, 63 were Yemeni, migrant workers from the Yemen, and 4 were from the Protectorate of South Arabia.
    Mr. Wall: Is my hon. Friend aware that many of the Aden trade unionists seem to be motivated not by a desire to improve the conditions of their members but by questions of international politics? Can he tell us how many strikes have been fomented there during the last 12 months?
    Mr. Fisher: I think that my hon. Friend is broadly right, but I do not know the number of strikes. I will look into it and let him know.
    Mr. G. M. Thomson: Is the Minister aware that the trade union movement in Aden is affiliated to the International Confederation of Free Trade Unions and is one of the best trade union movements in the Arab world? Is he further aware that, so far as it has a legitimate interest in politics, its resentments could be greatly eased by more vigorous action by Her Majesty's Government?

    Franchise
    Mr. Oramasked the Secretary of State for the Colonies what recommendations he has received for a revision of the franchise in Aden; and if the

    201
    next elections will be held on the basis of the present franchise or of a revised one
    Mr. Fisher: These matters are still being considered by the Aden Government.
    Mr. Oram: Is the Under-Secretary of State aware that there has been a quite inexcusable delay in this matter of franchise and elections in Aden which is leading to a sense of frustration in Aden and suspicion about Her Majesty's Government's intentions? Does the hon. Gentleman recall saying in this House on 26th February that elections were due this year and that there would be no question of delay? What is he doing to make sure that elections are held as soon as possible and on as wide a franchise as possible? There will be trouble if this is not done.
    Mr. Fisher: There is nothing sinister about this. The Commission of Inquiry established by the Chief Minister of Aden last August completed its report at the end of October and its recommendations are now under consideration by the Aden Council of Ministers.
    As to the date of the elections, these must be held, as the hon. Member knows perfectly well, within three months of the dissolution of the Legislative Council, which is due in January, 1964. Therefore, the elections must be held by April, 1964. We have no intention of introducing an Order in Council to postpone them, so they will take place during that period.
    Mr. G. M. Thomson: Does the hon. Gentleman recall that on 26th February, in answer to me, he gave an undertaking that elections would take place this year? Is he now saying that this pledge is to be broken?
    Mr. Fisher: No. There was possibly a misunderstanding. What I meant to say—and if the hon. Gentleman looks up the position in Aden he will see that this is correct—was that the present Legislative Council has to be dissolved in January, 1964, and that elections have to be held within three months thereafter. Therefore, what we are doing conforms entirely with the Constitution.

  NYASALAND

    Village Headman Nandumbo (Murder)
    Mr. Goodhewasked the Secretary of State for the Colonies what action has been taken to bring to justice the murderer or murderers of Village Headman Nandumbo, of the Kasupe District of Nyasaland
    The Under-Secretary of State for Commonwealth Relations and for the Colonies (Wr. R. P. Hornby): The Director of Public Prosecutions in Nyasaland has instructed that five Africans be charged with the murder of Village Headman Nandumbo. A preliminary inquiry is at present being held before the Resident Magistrate, Zomba, and the case is therefore sub judice.
    Mr. Goodhew: Is my hon. Friend aware that this man was beaten to death last June, that his relatives were intimidated into burying his remains in secret, and that it was not until August that the police ordered that his body be exhumed, when it was found that his skull had been fractured and two ribs had been broken, one of which had pierced his heart? Have not the authorities been very lax in getting on with the matter?
    Mr. Hornby: The case was reported to the Director of Public Prosecutions in Nyasaland on 9th September. Before authorising a prosecution, the Director required further statements from witnesses. Some time elapsed before the witnesses could be seen. There was inevitably, therefore, a delay before the Director of Public Prosecutions could institute proceedings in the middle of November.
    Sir G. Nicholson: Will my hon. Friend confirm that law and order in Nyasaland on the whole reaches a high standard and that a though, as in any country, it is possible to pinpoint disasters and criminal occurrences, it is most unfair to draw any deductions harmful to the reputation of Nyasaland?
    Mr. Hornby: A number of complaints have been made recently about law and order in Nyasaland. These have been very carefully investigated and a report has been published by the Deputy

    203
    Governor's office. Copies of the report have been placed in the Library. The report shows that many of the complaints have been greatly exaggerated and that considerable improvements have been made in the administration of law and order. It is, I am sure, the determined wish of the Nyasaland Government, no less than of ourselves, that justice should be properly administered there.

    Africans (Detention and III Treatment)
    Mr. Goodhewasked the Secretary of State for the Colonies if he is aware that citizens of Nyasaland are still being detained and ill treated when found not to possess Malawi Congress Party membership cards; by what authority this is being done; and what action the police are taking to preserve law and order
    Mr. Hornby: Isolated incidents of illegal detention or ill treatment of Africans have occurred in one district only during the past month. These actions have not had the backing of the party leaders. The Prime Minister, Dr. Banda, has constantly reiterated that they must cease. It is not a legal offence, as has sometimes been suggested, to be found to be without a Malawi Congress Party membership card. The police thoroughly investigate all complaints of this nature which are reported to them; and, when sufficient evidence is available, those accused are prosecuted.
    Mr. Goodhew: I welcome the news that the party leaders do not countenance this sort of behaviour, but is my hon. Friend aware that the Malawi League of Youth has been responsible for a number of beatings-up in various districts prior to the month he mentions and, in particular, for the death of the person referred to in my Question No. 14. What is being done to stop the League of Youth from behaving in this way? Secondly, has the Attorney-General yet withdrawn his instruction to the police that they are not to institute proceedings for violence or intimidation without his personal permission?
    Mr. Hornby: In reply to my hon. Friend's question about what is being done, I do not think that one can deal with the matter in general terms. I
    204
    shall gladly have investigated any specific cases which my hon. Friend cares to bring to my attention. His point about the Attorney-General is another matter. If my hon. Friend will put down a Question, I shall gladly deal with it. Strenuous efforts have been made to deal with and overcome some of the teething troubles which emerged as the result of the reorganisation of the local courts in Nyasaland, and very great progress in that respect has been made.

  KENYA

    British Ex-Service Men (Compensation Terms)
    Mr. A. Hendersonasked the Secretary of State for the Colonies if he will make a statement about the compensation terms offered to British ex-Service men who went to Kenya under the auspices of the European Agricultural Settlement Board.
    Mr. Fisher: In the Second Reading debate on the Kenya Independence Bill. my right hon. Friend said that he had carefully studied the case of the British ex-Service men who went to Kenya under the auspices of the European Agricultural Settlement Board; but he was not convinced that it would be fair to single them out for special treatment more favourable than for the rest of the European farming community. He said that about one-third of the Settlement Board farmers could expect to be bought out under the existing land schemes and that many others might be helped under the measures which he then announced.
    Mr. Henderson: Have not the Government a special obligation to these British ex-Service men who were encouraged to go to Kenya under the auspices of this scheme? Can we be assured that the Government are devoting the most sympathetic consideration to giving financial compensation to any of these ex-Service men who have to vacate their farms?
    Mr. Fisher: I am very sympathetic in this matter, but all these people went of their own accord and I think that it would be invidious to give any one category special treatment. There is no legal case against the Kenya Government. On the moral question, I think

    205
    that our obligation extends equally to all European farmers out there. On the right hon. and learned Gentleman's last point, I must honestly say that this is not intended to be a compensation scheme. It is intended to help Europeans if we possibly can, but it is an African land settlement scheme, not a compensation scheme for farmers.
    Mr. Henderson: Surely the hon. Gentleman would agree that the Government of the day did not encourage civilians in the same way as they encouraged ex-Service men who served their country during the war to go to Kenya?
    Mr. Fisher: I think that encouragement was given and that there is a moral obligation on us to help. We are trying to help, but I do not think there is any legal obligation. No guarantees were given, or anything of that sort, against hazards which might arise. I must ask the right hon. and learned Gentleman to bear in mind that the implications of a compensation scheme as such would be very wide and would go far beyond the confines of Kenya.

    Settlement Board
    Sir A. Hurdasked the Secretary of State for the Colonies what provision is being made for the extension of the work of the Settlement Board in Kenya after the Colony becomes an independent member of the Commonwealth; and to what extent the United Kingdom Government will continue to be responsible for the appointment of the Settlement Board and the finance of its operations
    Mr. Fisher: The European Agricultural Settlement Trust was established under local legislation. The British Government have no responsibility for the appointment of the trustees nor for the financing of its operations.
    Sir A. Hurd: Is not this the body which is looking after the settlement of the 1 million acres and any further land which, we understand, is now to be allocated for resettlement? If not, has the body been renamed? Can my hon. Friend tell us about the future of this body, which the Government are financing?
    Mr. Fisher: I think that the body referred to by my hon. Friend in his Question is the European Settlement Board which was discussed earlier, arising from the Question asked earlier today by the right hon. and learned Member for Rowley Regis and Tipton (Mr. A. Henderson).

    Hon. Member for Torquay (Entry Ban)
    Sir R. Robinsonasked the Secretary of Stat; for the Colonies the result of his inquiries into the reasons for the ban on entry into Kenya of the hon. Member for Torquay (Mr. F. M. Bennett) to attend the independence celebrations
    Mr. Fisher: The Governor has reported that the Kenya Government adhere to their earlier decision.
    Sir R. Robinson: To clear up one of the uncertainties of this case, may I ask my hon. Friend to give the date on which, without reason, this ban, which has been so strongly deplored on both sides of the House, was imposed?
    Mr. Fisher: I do not have in mind the exact date of the ban, but I will look it up and inform my hon. Friend as soon as possible.
    Sir C. Osborne: Since this decision affects a Member of this honourable House, may I ask whether it is not a pity that wherever the Union Jack is pulled down personal liberty seems to be restricted?
    Mr. Fisher: The views expressed by hon. Members, and the views of my right hon. Friend, have, of course, been conveyed to the Kenya Government. Our position is quite clear, but I do not think that there is anything else that we can do at this stage.
    Mr. Blyton: Is the hon. Gentleman aware that he should use his high office to try to bring tolerance to the Colonies who are getting independence? We had the instance concerning my hon. Friend the Member for Wednesbury (Mr. Stone-house) in 'Rhodesia, and the incident concerning my hon. and learned Friend the Member for Ipswich (Mr. D. Foot).

    207
    in whose case no reasons were given. Now that the Under-Secretary's hon. Friend is involved, should not his Department try to bring tolerance to these Colonies?
    Mr. Fisher: We always like to think that we are a good example and show tolerance to other countries. I do not think there is anything that we can do to induce tolerance in a country which is to become independent in two days' time, but I hope that people there will notice the reaction of hon. Members in this House.
    Mr. G. M. Thomson: Would it not have been better if the Minister himself had taken this opportunity to express the Government's regret at the position and not merely rely upon expressions of concern from back benchers on both sides of the House?
    Mr. Fisher: I thought I had done so. I said that the views of hon. Members and of my right hon. Friend, who naturally spoke for the Government, had been conveyed to the Government of Kenya. I could not have expressed it more clearly.

  SWAZILAND

    Mr. Sydney Hitching
    Mr. Swinglerasked the Secretary of State for the Colonies why the Swaziland Government, when selling him land for farming purposes and permitting him to import Jersey cattle, now refuses to grant a residence permit to Mr. Sydney Kitching, of Labora Farm, Manzini, and has requested him to leave the territory
    Mr. Fisher: The Swaziland Government has not sold any land to Mr. Kitching for farming purposes. He did not consult the immigration authorities either about his private purchase of land or his importation of cattle. The Immigration Control Board did not consider itself justified in granting Mr. Kitching a permanent residence permit.
    Mr. Swingler: Will the Under-Secretary of State investigate that information further? Is it not a fact that Mr. Kitching has been permitted to purchase several
    208
    farms and to import Jersey cattle through South Africa where he has interests? Is it not extraordinary that, having developed some agricultural methods in Swaziland, he seems to have been asked to leave mainly because he is a strong opponent of apartheid?
    Mr. Fisher: I assure the hon. Member that there were no political reasons for this. As he knows, it is not normal to publish reasons in these cases, but if he cares to have a word with me after Question Time I will give him the reason. It was certainly not political. Mr. Kitching purchased this land on his own initiative, knowing perfectly well that he had only a temporary residence permit which would expire very soon.

    Constitution
    Mr. Taverneasked the Secretary of State for the Colonies when the new Constitution for Swaziland will come into effect
    Mr. Wallasked the Secretary of State for the Colonies when the proposed new Constitution for Swaziland will be brought into effect
    Mr. Fisher: It is proposed to make the Order in Council on 20th December. It will be brought into effect on a date to be announced later.
    Mr. Wall: Will my hon. Friend undertake to look into the method of election to and the composition of the Legislative Council? Will he give particular attention to the method advocated by a large majority of Swazis and put forward by the Ngwenyama, which is a much fairer and simpler way than the method proposed in the White Paper?
    Mr. Fisher: My right hon. Friend looked at this proposal and was very interested in it. One of the difficulties is that the system which my hon. Friend suggests would require the re-registration of electors and the drawing of new constituencies every time there was an election. It is thought that this is rather impracticable.

  COLONIAL TERRITORIES

    Colonies and Protectorates
    Mr. Sorensenasked the Secretary of State for the Colonies what territories for which he is responsible remain classified as Colonies and Protectorates, respectively; what is the population and area of each of these; and what gross amount of financial aid is being extended to them
    Mr. Fisher: I will, with permission, circulate in the Official Report a list of the Colonies or Protectorates for which my right hon. Friend is responsible, together with details of their areas and populations.
    The financial aid to these territories for the financial year 1962–63 was approximately £32,500.000, details of which were published on 4th December in Cmnd. 2147.
    Mr. Sorensen: I thank the Undersecretary of State for that Answer. May I ask two questions? First, can he give some indication of the different kinds of Protectorate which are now within his responsibility? Secondly, in view of the very striking contrast between the area and population of the colonial empire 20 years ago and now, what steps has he taken to publicise this fact and the means by which this transformation is being more or less completed?
    Mr. Fisher: On the hon. Gentleman's first supplementary question, the Protectorates vary very much. These are Bechuanaland, the British Solomon Islands, Northern Rhodesia, Nyasaland, Swaziland, the Protected States in South Arabia and part of The Gambia. I think that in this enterprise both parties have made a very great contribution. I should like to see more publicity given to the fact that we have decolonised to this extent. I hope that the hon. Gentleman's Question will give rise to some publicity on that count.
    Following is the list:

    AREAS AND POPULATIONS OF COLONIES AND PROTECTORATES

    Colonies

    Population (latest estimates)

    Area (sq. miles)

    Antigua

    54,304

    171

    Bahamas

    111,109

    4,404

    Barbados

    232,270

    166

    Basutoland

    711,000

    11,716

    Bermuda

    45,872

    21

    British Antarctic Territory.

    No permanent population

    Lies between 20 and 80 of west longitude and and south of 60th parallel of latitude

    British Guiana

    560,406

    83,000

    British Honduras

    96,340

    8,866

    British Virgin Is.

    7,700

    59

    Cayman Is.

    7,622

    100

    Dominica

    61,029

    290

    Falkland Is.*

    2,172

    4,618

    Fiji

    421,000

    7,095

    Gibraltar

    24,151

    2¼

    Gilbert and E lice Is.

    48,172

    369

    Grenada

    90,080

    133

    Hong Kong

    3,592,100

    398

    Malta, State of

    328,141

    122

    Mauritius

    699,900

    808

    Montserrat

    12,831

    33

    Pitcairn Is.

    127

    2

    St. Christopher-Nevis-Angulla.

    56,591

    138

    St. Helena*

    4,527

    47

    St. Lucia

    86,108

    238

    St. Vincent

    82,456

    150

    Seychelles

    43,748

    156

    Turks and Ca cos Is.

    5,947

    166

    Protectorates

    Bechuanaland

    332,000†

    222,000

    British Solomon Is.

    124,000

    11,500

    Northern Rhodesia

    2,514,800

    288,130

    Nyasaland

    2,900,000

    45,747

    Swaziland

    280,3001‡

    6,705

    Colony and Protectorate Aden and the Protectorate of South Arab a—

    Aden

    220,000

    75

    Protectorate

    1,000,000

    111,000

    Gambia

    315,999

    4,003

    *Excludes dependencies.

    † Excludes nomad population.

    ‡ Includes absentee population.

    NOTE: This list does not include Southern Rhodesia which has been a self-governing Colony since 1923, or Kenya and Zanzibar which become independent this week.

  ST. VINCENT

    Demonstrations (Convicted Persons)
    Mrs. Whiteasked the Secretary of State for the Colonies if he will make a

    211
    statement concerning the circumstances in which seven men, convicted for offences arising out of demonstrations in St. Vincent on 2nd March, 1962, who lodged an appeal against sentence, were not given the result of their appeal until 2nd November, 1963, and were then told that their sentences were to run from this date
    Mr. Fisher: The seven men were convicted on 4th March, 1963, and sentence was passed on 19th March. Notice of appeal was given on 15th March. The appeals were heard on 13th August but judgment was not given until 2nd November. Their sentences will run from 19th March, the date of the passing of sentence, and not from 2nd November.
    I have just been informed this morning that a notice of intention to petition the Privy Council for leave to appeal has been served. In the circumstances it would not be appropriate for me to comment until the further legal proceedings have been concluded.
    Mrs. White: In thanking the hon. Gentleman for that reply, may I ask whether he will undertake to investigate certain rather peculiar circumstances surrounding this case, of which I will send him particulars?
    Mr. Fisher: Yes, of course I will.

    SCHOOL BUILDING PROGRAMME, FIFE
    Mr. W. Hamiltonasked the Prime Minister what reply he has sent to the Fife County Council's representations against the cutting of their school building programme for 1964–65 to £300,000
    The Prime Minister (Sir Alec Douglas-Home): I told the county council that its representations would be considered by my right hon. Friend the Secretary of State for Scotland. A fresh proposal has been made to the council, namely, that it should plan in the expectation of being permitted to startschools to the value of £1 million in each of the next three years.
    Mr. Hamilton: Is the right hon. Gentleman aware that this is still merely a fraction of what the Fife County Council says that it can achieve if given the
    212
    necessary permission by the Government? What sense is there in slashing the original estimates of local authorities and then, if the local authorities shout loud enough, the Government making a concession which is fractionally part of what the local authority originally asked for? Can the Prime Minister give an assurance that if any other local education authority makes its representations and makes them loud enough, it, too, will get an increase in its allocation in this election year?
    The Prime Minister: My right hon. Friend reviews the situation from time to time and is not in a position now to allot any more than this sum to school building in Fife. It is a fairly substantial sum.
    Sir J. Gilmour: Would not my right hon. Friend agree that we should be grateful for the extra money that is made available for the new developing towns in the area represented by the hon. Member for Fife, West (Mr. W. Hamilton), but that there is also need to see that the rebuilding of schools in the older parts of the county, such as Dunfermline and St. Andrews, is equally catered for?
    The Prime Minister: Yes, Sir. I certainly take the point and I think that £1 million in each of the next three years will look after the point which my hon. Friend has made.

    BY-ELECTIONS (PUBLIC OPINION POLLS)
    Sir G. Nabarroasked the Prime Minister what steps he is taking to inquire into influence upon voting in Parliamentary, by-elections, as at Kinross and East Perthshire, and at Luton recently, by the conduct of public opinion polls between nomination day and polling day; and whether he will make a statement
    The Prime Minister: I doubt if electors allow their votes to be influenced by these polls and I see no reason for an inquiry at present.
    Sir G. Nabarro: A very good Answer. Would not my right hon. Friend agree that public opinion polls add greatly to the gaiety and vivacity of Parliamentary elections and would he dismiss at once

    213
    the complaint made by Scottish Liberals after the Kinross by-election that their vote was adversely affected by an opinion poll? Would he dismiss it as stunting, as also was the Liberal alleged punch-up outside the St. Marylebone Town Hall last Thursday night?
    The Prime Minister: I thought that I took the earliest opportunity I could to put all my opponents in their place.
    Mr. Wigg: Will the Prime Minister also take into account the amount of pints which he bought the electors during the course of the campaign?
    Sir G. Nabarro: On a point of order. Is it in order for an hon. Member opposite to allege against the Prime Minister that he bought pints for electors in Kinross, thereby imputing—[Hon. Members: "Sit down."]—a breach of electoral law against my right hon. Friend? [Interruption.] Would you require that opprobrious suggestion to be withdrawn, Mr. Speaker?
    Mr. Speaker: I do not think that it is a matter for me. In any event, I did not hear what was said.
    Sir G. Nabarro: Further to that point of order—[Interruption.]
    Mr. Speaker: Order. Question Time is precious. I should be grateful if I might be permitted to hear what is being addressed to me.
    Sir G. Nabarro: As all my hon. Friends and myself heard the imputation that the Prime Minister bought pints for electors at a by-election, is it not reasonable to require it to be withdrawn?
    Mr. Speaker: I do not propose to rule on anything I did not hear myself. It is too difficult. Do let us get on.

    FISHING INDUSTRY
    Mr. Loughlinasked the Prime Minister if he will appoint a separate Minister for the Fishing Industry
    The Prime Minister: No, Sir. I consider that the interests of the fishing industry are best served by the present arrangements.
    Mr. Loughlin: Whilst I do not want to imply any criticism of the present
    214
    Minister of Agriculture, Fisheries and Food, may I ask whether the right hon. Gentleman is aware that the fishing industry has an enormous number of problems at present and that it is very disturbed? If he cannot appoint a separate Minister for the industry, would it not be possible for him to arrange for one of the Parliamentary Secretaries to the Ministry to devote himself whole-time to fisheries?
    The Prime Minister: I know the hon. Member's interest in this. I, too, am interested in the fishing industry. As Foreign Secretary I conducted the negotiations with Iceland. I think that the Minister of Agriculture, Fisheries and Food, the Secretary of State for Scotland and the Foreign Secretary are a very good team to conduct negotiations about fishing.
    Mr. Ridley: Is my right hon. Friend aware that this is the sixth new Ministry which hon. Membersopposite wish to create? Has he formed any estimate of the cost of this further extension?
    Mr. Hector Hughes: Does the right hon. Gentleman realise that the suggestion in my hon. Friend's question is of added importance in view of the failure of the fisheries conference last week? Will he, therefore, reconsider his Answer?
    The Prime Minister: I have no evidence—and I do not know what evidence the hon. and learned Member can have—that the conference has failed. I have no desire to multiply Ministries. I think that under present arrangements we can deal with the fishing industry's problems adequately.

    PRIME MINISTER OF NORTHERN IRELAND (MEETING)
    Mr. McMasterasked the Prime Minister whether new measures were discussed during his meeting with the Prime Minister of Northern Ireland to help reduce unemployment in Ulster
    The Prime Minister: The main purpose of this meeting was to enable me to meet the Prime Minister of Northern Ireland, but, together with my right hon.

    215
    Friend the Home Secretary, we discussed various aspects of the Northern Ireland economic position.
    Mr. McMaster: Is my right hon. Friend aware that the news of an early meeting between him and the Prime Minister of Northern Ireland will be very much welcomed there? Will my right hon. Friend do all he can to see that the United Kingdom Government's new assistance through increased public expenditure in development areas is extended to Northern Ireland in proportion to the number of men out of work there?
    The Prime Minister: I heard my hon. Friend's speech in the House last week and read the reply made by my right hon. Friend the Chief Secretary to the Treasury. I hope that they were both satisfactory.

    PRIME MINISTER AND PRESIDENT JOHNSON (MEETING)
    Mr. Stonehouseasked the Prime Minister if he will make a statement on his discussion with President Johnson; and what arrangements have been made for a further meeting in the New Year
    Mr. A. Hendersonasked the Prime Minister whether he discussed with President Lyndon Johnson at their recent meeting the need to take a new initiative with a view to ending the present deadlock at the Geneva Disarmament Conference
    Mr. Rankinasked the Prime Minister if he will make a statement on his recent meeting with the President of the United States of America
    The Prime Minister: The purpose of my recent visit to Washington was to join in the tributes to President Kennedy paid by Governments and peoples from all over the world. While I was in Washington I had a brief talk with President Johnson but there was not the opportunity nor was this the occasion for detailed discussion. As the House knows, I shall be visiting the UnitedStates for more detailed talks in February.
    Mr. Stonehouse: When the right hon. Gentleman goes to the United States again, will be put two questions? First, will he ask the Americans not to be deflected from their wish for a reduction in tariffs during the G.A.T.T. negotiations next year, despite the trade war which is being forecast as a result of the Common Market countries increasing their tariffs? Secondly, will he tell the Americans that this country wants no part in a mixed-manned force, as was confirmed by a vote at the Western European Union Assembly last week?
    The Prime Minister: The answer to the first of those questions is "Yes" and the answer to the second "No".
    Mr. Henderson: In view of the resumption of the Geneva disarmament conference on 21st January, may I ask the right hon. Gentleman whether the Government intend to negotiate new proposals for making a start on the physical processes of disarmament, such as a reduction of the numbers of nuclear vehicles and missiles? Does he propose to attend the conference, or will it be at Foreign Ministers' level?
    The Prime Minister: I understand that the conference will be at Foreign Ministers' level, and my right hon. Friend the Foreign Secretary will, of course, be attending.
    We are consulting the Americans about disarmament proposals and whether there is any fresh initiative we can take. I think that the right hon. and learned Gentleman will have read my speech to the United Nations Assembly in which I expressed the hope that we might perhaps include the destruction of some nuclear delivery vehicles in stage one.
    Mr. Rankin: When the right hon. Gentleman meets President Johnson, will be consider putting forward the idea of appointing neutral observers at appropriate points on each side of the East-West border in Europe in order to try to build up further confidence between both sides?
    The Prime Minister: I have myself felt that this ought to be done, but the need is to press it on the Soviet Union rather than on the United States.
    Sir C. Osborne: Will my right hon. Friend bear in mind what Mr. John McCloy said last night at the Pilgrims'Dinner—that whether we like it or not the Americans are the best friends we have in the world?
    Mr. P. Noel-Baker: Will the right hon. Gentleman instruct our delegates to the Committee of Eighteen to put forward compromise proposals, drawing on what is best in both the Russian and the American draft treaties, as he himself urged should be done in the Committee 18 months ago?
    The Prime Minister: The United States draft treaty is the treaty which we support but, of course, there are certain suggestions in the Russian draft treaty which are well worthy of consideration and possible importation into the final agreement that might be made.
    Mr. P. Noel-Baker: Since the Conference has been meeting for nearly two years, is it not time we began to accept some of the Russian proposals?
    The Prime Minister: It depends on what the Russian proposals are. As the right hon. Gentleman knows, this is a very complicated question. I am as keen as he is to make progress in this. There is the question, of course, which we cannot answer ourselves yet, as to how far the Russians themselves, in view of the Chinese position, feel it safe to disarm.

    UNEMPLOYMENT
    Mr. Shinwellasked the Prime Minister what action the Secretary of State for Industry, Trade and Regional Development, the Ministers of Pensions and National Insurance and Labour, and other Ministers concerned, are taking to prepare a co-ordinated scheme for the relief of unemployment, pending the completion of schemes referred to in the White Paper on regional development
    The Prime Minister: The Government's plans for assistance to areas of high unemployment include a number of measures which are already in operation. Amongst these are the new standard grants under the Local Employment Act, 1963, free depreciation on investment undertaken in development districts, a
    218
    substantial increase in public service investment in the North-East and Central Scotland, permission for local authorities to undertake work up to £15,000 without prior authorisation in the coming winter and a £75 million credit scheme for shipbuilding. The sharp increase in unemployment when occurred in the autumn of last year has not happened this year and unless we have another abnormally hard winter the effect of these measures should be increasingly felt in the coming months.
    Mr. Shinwell: Would not the right hon. Gentleman agree that the schemes to which he has just referred, though very good in themselves, will take some time to come to fruition Does he recognise that both in Scotland and the Norht-East, and in some other parts of the country, there exist a vast number of unemployed persons for whom no relief is available apart from unemployment benefit and, occasionally, National Assistance? Would not he agree; that some further relief should be provided either by an increase in unemployment benefit or by a revision of National Assistance allowances?
    The Prime Minister: My right hon. Friend the Secretary of State for Industry and Trade is concerned with training schemes for young people who may not be able to find employment. I think that I would like to see the full effect during this winter of the measures we have taken. I think that it may be quite considerable.
    Mr. W. Hamilton: Does the Prime realise that there are very nearly 100,000 unemployed n Scotland before the winter starts, and that the great majority of the schemes he outlined a few moments ago will have no effect whatever on their standard of living nor that of the thousands of unemployed in England? How can he say that we are one nation when there are hundreds of thousands living on subsistence rates?
    The Prime Minister: I cannot accept the hon. Gentleman's suggestions and forecasts in this case. The total of assistance on firm offers, for instance, under the Local Employment Act at the end of October amounted to £93 million for 494 projects which can provide employment for nearly 100,000 people. [Interruption] The hon. Gentleman

    219
    made certain assertions and I must refute them. The loans for the shipbuilding industry alone, I would have thought, are already having an effect on the Clyde.
    Mr. H. Wilson: Is the right hon. Gentleman purporting to refute the only assertion contained in the supplementary question of my hon. Friend the Member for Fife, West (Mr. W. Hamilton)—namely, that there are more than 100,000 unemployed in Scotland before the onset of the winter and a great many more in England, all living on subsistence rates? Does the Prime Minister accept that as part of the present situation or does he not?
    The Prime Minister: It was the fact of unemployment in Scotland and the North-East that led us to introduce our present proposals.
    Mr. Shinwell: Do those answers mean that the right hon. Gentleman proposes to ignore the low standard of living, and, in many cases, the lack of proper nutrition for more than 400,000 unemployed? [Interruption.] Is that what it means? Is that all the sympathy he has? Let him answer that question. [Interruption.] You ought to be ashamed of yourselves.
    The Prime Minister: The right hon. Gentleman and his hon. Friends have been pressing us for a long time to do something about the North-East of England and Scotland. We have now taken certain measures which I think will be effective, and I want to see the results.

    PENSIONS AND ALLOWANCES
    The following Question stood upon the Order Paper:
    Dame Irene Ward
    The Prime Minister (Sir Alec Douglas-Home): With permission, I will answer Question No. Q14.
    My right hon. Friend the Member for Bromley (Mr. H. Macmillan) told the House on 1st August that he was considering certain matters concerning pensions and allowances. Since I
    220
    became Prime Minister I have myself been looking into this question and the representations that have been made particularly as regards widows.
    My right hon. Friend the Minister of Pensions and National Insurance will put detailed proposals before the House in today's debate. These proposals will be directed mainly towards some improvement in the position of widowed mothers, whether they go out to work or stay at home and look after their children, and will be on the following lines:
    First, the widowed mother's personal allowance will continue until the last child's nineteenth birthday instead of the eighteenth birthday as at present; and the child's allowances and the family allowances in respect of widowed mothers will also continue until the child's nineteenth birthday instead of the eighteenth birthday on the same conditions that now apply, namely, if the child is in full-time education or is a low-paid apprentice. This involves extending to the same limit the children's allowances paid to other National Insurance beneficiaries. The cost of this proposal will be £2 million a year, including about £1 million for family allowances, rising to about double that cost within 10 years.
    Secondly, we propose a change in the allowances to the children of widowed mothers and an increase in the amount. At present these children attract a National Insurance allowance and a family allowance. We now propose a single allowance of 37s. 6d. a week in respect of each child of a widowed mother, instead of the existing aggregate allowance of 30s. a week for the first and second children and 32s. a week for subsequent children. The estimated cost of this is £3½ million a year.
    Thirdly, we propose some improvement in the earnings rule as it applies to all widows and to retirement pensioners with a continued preference for widowed mothers. We propose that the earnings limits should be increased from £6 to £7 in the case of widowed mothers and from £4 5s. to £5 in the other categories. The cost of this would be about £2 million.
    In addition, we propose to deal with the situation of what are known as pre-Grigg widows. These are the widows

    221
    who have been drawing pensions on the basis of the 1952 code because their husbands died before the date—4th November, 1958—on which the Government accepted the recommendation of the Grigg Committee that future Service widows' pensions should be related to their husbands' retired pay or pension. It has now been decided that the pensions of those pre-Grigg widows should be calculated on the same percentage basis as widows whose husbands died on or after that date. The cost of this is estimated at £300,000 in the first year.
    Dame Irene Ward: Will my right hon. Friend accept the appreciation of many hon. Members, myself among them, of this new break-through? Will he convey to the Chancellor our appreciation of his co-operation with my right hon. Friend? Will he also accept my pleasure at the successful result of our assignations and my hope that he will go from strength to strength in the magnificent new break-through which he has so successfully started?
    The Prime Minister: The House knows how interested my hon. Friend has always been in these questions. What my colleagues and I were particularly anxious to do was to benefit not only the widow who was ableto go out to work, but the equally deserving widow who stayed behind to look after her children.
    Mr. H. Wilson: While the Government are now being a little more forthcoming at this late hour, after resisting for several years our proposals in this direction, as is on record, proposals against which hon. Members opposite have voted, will not the right hon. Gentleman agree that the time is now long overdue for abolishing the earnings rule in respect of widows? Why does he not do it?
    Sir G. Nabarro: The right hon. Gentleman's party did not say that at the Scarborough Labour Party conference.
    Mr. H. Wilson: Of course we did. [Interruption.] Is the right hon. Gentleman aware, if he can hear what I am saying, that this was said in our policy statement at our party conference and was available to be read by those hon. Members who can read? Finally, is the right hon. Gentleman proposing nothing
    222
    to help the position of the so-called 10s. widow, who is suffering more acutely than any other class in the country?
    The Prime Minister: People hold different opinions about the earnings rule. We have held the view, and we have acted upon it, that we should make an extra allocation in this matter and that the widow who earns £7 a week should not have that deducted when her pension is assessed. I think that that is a tenable position. I cannot say what the future may hold. The broader and more general question of pensions must be a matter which all Governments keep under review.
    Mr. Wilson: Probably because of the noise, the right hon. Gentleman forgot the second of my questions. Will he tell us why nothing is being done about the so-called 10s. widow?
    The Prime Minister: I have nothing to say on this occasion about the 10s. pension.
    Miss Vickers: I thank my right hon. Friend for what he has said. Is anything to be done for the public service widows and the widows of Service men drawing pensions under several different codes, some getting less than £200 a year?
    The Prime Minister: What is known as the pre-Grigg class of widows is a case in which there is an anomaly which I am convinced should be put right. The wider question must wait for another occasion.
    Mr. Bellenger: While congratulating the right hon. Gentleman on the result of his ruminations since he became Prime Minister, may I ask him whether that statement portends an early General Election?
    The Prime Minister: I think that the right hon. Gentleman had better wait and see, but he had better be ready for it at any time.
    Captain Litchfield: May I ask my right hon. 'Friend whether he is aware that his action in personally looking into this question of the pensions of Service widows so soon after assuming office, and in announcing this welcome decision, will be very warmly appreciated far outside the circles concerned in this House, in the constituencies, and in the Services?
    Mr. Paget: May I ask the Prime Minister whether he is aware that 1958 widows are only one of the examples of anomalies in Service pensions, and that this arises from paying pensions not in respect of service, but in respect of the date of retirement? Will the Prime Minister tell us that at some time the principle of the same pension for the same service will be seriously considered? Anything else is grossly unjust.
    The Prime Minister: I have said that I have satisfied myself that this is one anomaly with which we ought to deal, and I hope that the House will feel that that is right. If I discover other anomalies we may be able to deal with them in future.
    Mr. H. Wilson: When the Prime Minister says that he has nothing to say about the 10s. widows, does it mean that we can expect a statement from him in the near future about this, or has he considered this anomaly and decided to do nothing about it?
    The Prime Minister: I meant what I said. We have dealt with a certain section of widowed mothers, and the pre-Grigg widows. The wider question of other pensions is a matter which Governments must always keep under review and do their best for the country.
    Several Hon. Members rose—
    Mr. Speaker: I think that we can discuss these matters further at a later stage.

    ARAB BOYCOTT OF ISRAEL (BRITISH FIRMS)
    The following Question stood upon the Order Paper:
    Sir B. JANNERTo ask the Secretary of State for Foreign Affairs if he will take steps to prevent states from using their representatives in Great Britain for the purpose of coercing business firms in this country to dismiss officers or employees who are connected with trade with friendly states; and if he will make a statement
    The Minister of State for Foreign Affairs (Mr. Peter Thomas): With your leave, Mr. Speaker, and that of the House, I will now answer Question No. 63.
    224
    Her Majesty's Government strongly disapprove of pressure from any source on British firms to discriminate between British subjects on any grounds. We have made our views known to representatives of the Arab embassies in London. In doing so, we have expressed our disapproval of action by these embassies designed to bring pressure on British firms to comply with the Arab boycott of Israel, and we have said that we hope these practices will not continue.
    Sir B. Janner: May I thank the Minister for that important and gratifying step forward? May I ask whether he is aware that the deepest interest will be taken abroad, and, in particular, in European countries, in the reply that he has given? May I also ask whether he will make it a part of the policy of the Government, or continue to make it part of the Government's policy, to encourage British merchants and industrialists to expose and resist any of these vicious pressures in the future?
    Mr. Thomas: I think that what I have said makes our views on this matter perfectly clear.
    Mr. Biggs-Davison: May I ask my hon. Friend whether he is aware that all those who want the friendliest relations with the Arab States, on a basis of mutual respect, warmly welcome the attitude which the Government have taken and my hon. Friend's statement?
    Mr. H. Wilson: As my right hon. Friend who deals with foreign affairs is away on work of national importance—in Dumfries—may I be allowed to ask the Minister whether he is aware that the statement he made is wholeheartedly supported from this side of the House? Will the Minister join us in condemning the action of the Norwich Union Company in giving in to pressure of this kind, which must make his task in what he is trying to do a great deal harder?
    Mr. Thomas: I do not think that it would be appropriate for Her Majesty's Government to condemn the action of any individual firm. I think that the best course that we can take in this very difficult matter is to express our disapproval of certain actions which have been taken by the Governments concerned.
    Mr. Longden: May I ask my hon. Friend whether he is aware that great mutual organisations like the Norwich Union do not need the help and advice of Her Majesty's Government? All they need are a few more guts. But individuals and smaller firms who do ask for the advice of Her Majesty's Government are not getting it in very firm terms; not in the terms such as my hon. Friend has now announced. Will the Minister inject into the replies that go out from the Board of Trade a little more strength and advice that they should ignore this boycott—advice such as the American and West German Governments are giving to their citizens?
    Mr. Thomas: I think that it is for a firm to decide for itself, in the light of its own interests, whether it wishes assistance from Her Majesty's Government. Our feelings about this boycott have been made clear, and if any individual firm wishes advice or assistance, we shall, of course, consider the request.
    Mr. Paton: May I ask the Minister whether he will accept that this condemnation, although a little belated, is none the less welcome? I hope that this condemnation by the Government will stiffen the backs of some of these boneless wonders who seem to be running some of the greatest commercial institutions in the country.
    As the Arabs are not likely to cease these activities, will the Minister consider going a little further and taking legal action to prevent discrimination in international trade by industrial and commercial organisations in this country? We want all trade discrimination to be made illegal. [Hon. Members: "Speech."] It is a very good speech.
    In addition to making trade discrimination illegal, we should also make discrimination on racial and religious grounds illegal. Will the Minister examine this further?
    Mr. Thomas: I do not think I can add to what I have said on the question of trade discrimination. As the House knows, Her Majesty's Government deplore all racial discrimination. But, in fairness, I think that I ought to say that the Arab embassies, representatives of whom came to the Foreign Office yesterday, emphasised that this boycott is not discrimination on racial grounds. They
    226
    explained that the boycott derives from what they maintain is a state of war between Israel and the Arab countries.
    Several Hon. Members rose—
    Mr. Speaker: We cannot discuss this further without a Question before the House, and we have so much to do.

    NATIONAL BUILDING AGENCY
    The Minister of Public Building and Works (Mr. Geoffrey Rippon): With your permission, Mr. Speaker, and that of the House, I should like to make a statement on the establishment of a National Building Agency.
    To fulfil the country's needs for new buildings of all kinds, the output of the building industry must increase by more than 50 per cent. in the next decade. Accordingly: the Government propose to set up a National Building Agency to further the industrialisation of building. [Hon. Members: "Hear, hear."] I am today laying before the House a White Paper outlining the proposal. Copies are now available in the Vote Office.
    The Agency will have two main functions. First, it will help to co-ordinate the requirements of those wishing to build into programmes which are large enough, and continuing enough, to make possible the economic use of industrialised methods.
    Secondly, it will offer expert and technical advice about the newest methods. The Agency's services will be available both to public authorities and to the private sector.
    The Agency will not itself actually undertake any building work, and its use will be voluntary. I expect that its services will be of particular value in the first instance to the smaller local authorities. It is intended to supplement and not to supersede the existing and developing consortia of local authorities.
    The Agency will be an independent body, covering the whole of the United Kingdom. It will be managed by a board appointed by the Minister of Public Builiing and Works after consultation with the building industry and the local authorities. It will be supported in part by public funds, but will charge fees for its services.

    227
    Before the Agency is established I propose to hold formal consultations on the detailed arrangements with the appropriate organisations representing the construction industries, the associated professions and the local authorities.
    Mr. C. Pannell: Will the right hon. Gentleman accept the congratulations of hon. Members on this side of the House on bringing forward now a proposal which has been in our last two General Election manifestos? For this measure of creeping Socialism, after 12 years, we give him thanks.
    I want to ask one or two questions about the Agency. Why is the Minister so inhibited as to say that the Agency will not undertake any building work at all? Why does he need to put this proscription in at the beginning and thus rob himself of a powerful economic weapon?
    When the right hon. Gentleman says that
    "The Agency will be an independent body covering the whole of the United Kingdom"
    how independent does he mean? Is it proposed that he will be in no way answerable for it in this House? How public will it be? What sort of body has he in mind to employ?
    Further, how long does the right hon. Gentleman feel that it will be necessary for these deliberations to take place before he can make another statement to the House indicating rather more closely how this skeleton is to be clothed?
    Mr. Rippon: The hon. Member will see from the White Paper the nature of the proposals in more detail, but I hope to be able to establish the Agency and appoint the board and officers in the early part of next year, after consultations have been completed. Hon. Members opposite cheered a little too quickly. There is no comparison between this Agency and the sort of body they would set up. Hon. Members on this side believe that we can achieve by voluntary co-operation what hon. Members opposite believe can be done only by direction and control.
    This Agency is a logical extension of what has been taking place in the industry—first, the development of new
    228
    systems and new techniques, secondly, the development of consortia of local authorities with whom we shall continue to work closely and not supplant by new bodies to do the building for them, and, thirdly, the function of my own Ministry and the progress that we have made so far on standardisation and dimensional co-ordination.
    The Agencywill be a body independent of the Government. I envisage that it will be a company, limited by guarantee. In due course, once the body is established, we shall no doubt have to consider how Questions about its activities will be dealt with. In effect, it is the other side of the coin to the research and development organisations which the Government have established. It will be independent. Its use will be voluntary, but it will make available throughout the rest of the public and private sectors the schemes that we are bringing forward within our own Government building programme.
    Mr. C. Pannell: Why does the Minister rob this Agency of the right to do a bit of building on its own account?
    Mr. Rippon: It will exceptionally provide a full design service. It is not necessary for it to do the building. If it helps by advising people on what schemes they should adopt and how best they can meet their problems and co-ordinate their orders, the building can be done in the ordinary way by the building industry. If the clients co ordinate their demands in the right way, the industry has the resources, capacity and techniques to fulfil those demands.
    Mr. Farr: In view of the fact that the standard of completion in many new houses today still leaves much to be desired, can my right hon. Friend tell me whether the Agency will be concerned with the finishing standard of new houses?
    Mr. Rippon: As a result of this and the other measures that the Government have taken, we shall have not only quicker and, in the long run, cheaper building, but better building.
    Mr. Woodburn: The Minister has said that this Agency's activities are to extend over the whole of the United Kingdom. Is he aware that there has been a Scottish Special Housing Association for about 20 years, which has

    229
    been doing this kind of work? Can he explain what is to be the relationship between this new organisation and the Association?
    Mr. Rippon: It will work closely with the local authorities, the new towns and the Scottish Special Housing Association, but at the moment the consortia arrangements in Scotland do not cover anything like the whole of the housing of Scottish local authorities. Only 16 out of 232 come into the arrangements which have so far been established. Thirty per cent. of housing in Scotland is still outside the consortium, which includes the Scottish Special Housing Association. In the case of education authorities, out of 35 in Scotland only two are in a consortium. There is, therefore, room—and this is recognised in Scotland—for an Agency of this kind.
    Mr. Robert Cooke: Can my right hon. Friend say how much of this Agency's work will be devoted to training workers in the building industry in new skills, especially in view of the grave shortage of skilled men which exists, particularly among small builders?
    Mr. Rippon: We have in mind that the Agency will be able to help in encouraging educational and other bodies, including any industrial training board, to provide more extensive facilities for training in the new techniques. This is one of the points covered in the White Paper.
    Mr. Lubbock: Is the Minister aware that the Liberal Party welcomes the idea of leaving local authorities as the main agencies for the building programme? On the other hand, we do not think that the proposals contained in his statement go nearly far enough. One of the main difficulties of local authorities in embarking on comprehensive redevelopment programmes is not only in respect of the technical assistance they need to build
    230
    themselves, but in respect of town planning and traffic engineers, and so on, who may not be available in a small local authority. Can the right hon. Gentleman tell us whether this type of technical assistance will be available to local authorities through this Agency?
    As the Minister has definitely decided that this Agency will not be responsible for giving any financial assistance to local authorities, may I ask him whether he is aware that the main difficulty facing local authorities who undertake comprehensive redevelopment programmes is that there is a long period during which these schemes constitute a severe burden on their rate income?
    Mr. Rippon: I am glad to have that limited welcome from the Liberal Party, recognising that this is a good start. The Agency will not do everything at once, but it will help in giving local authorities advice and, over a period, help them to spend to far better advantage what money they are able to dig out of the Treasury and their ratepayers.

    NEW MEMBERS
    The following Members took and subscribed the Oath or made the Affirmation required by law:
    Charles Richard Morris, esquire, for Manchester, Openshaw.
    Right Honourable Quintin McGarel Hogg, Q.C., St. Marylebone.
    Keith Morin Stainton, esquire, Sudbury and Woodbridge.

BUSINESS OF THE HOUSE (SUPPLY)
Ordered,
That this day Business other than the Business of Supply may be taken before Ten o'clock.—[Mr. Redmayne.]

ORDERS OF THE DAY

  SUPPLY
  [2ND ALLOTTED DAY]
  Considered in Committee.
  [Sir WILLIAM ANSTRUTHER-GRAY in the Chair]

  CIVIL ESTIMATES, SUPPLEMENTARY ESTIMATES, 1963–64

    CLASS XI
    VOTE 5. SUPPLEMENTS TO PENSIONS, ETC. (OVERSEAS SERVICES)
    Motion made, and Question proposed,
    That a Supplementary sum, not exceeding £192.000, be granted to Her Majesty, to defray the charge which will come in course of payment during the year ending on the 31st day of March 1964, for the payment of supplements to certain colonial and other overseas pensions, and of pensions, etc., in respect of service under the former Government of Palestine.
    Whereupon Motion made, and Question, That the Chairman do report Progress and ask leave to sit again—[Mr. J. E. B. Hill],—put and agreed to.
    Committee report Progress; to sit again Tomorrow.

  SOCIAL SECURITY
  4.5 p.m.
  Mr. G. R. Mitchison: I beg to move,
  That this House calls upon Her Majesty's Government to introduce without delay a comprehensive social security system to provide adequate guaranteed minimum incomes and wage-related benefits applicable on retirement, sickness, unemployment and widowhood and. pending the introduction of such a system, to take immediate steps to meet the hardships of pensioners and widows and to provide better facilities for the seriously disabled.
  In this Motion we invite the House to call upon the Government to introduce a comprehensive social security system without delay. We go on to say what we think it should cover and we also ask for some immediate help for the people concerned.
  I propose to begin by saying why we think that a comprehensive social
  232
  security system does not exist at present and is needed. We think that the present system is gradually breaking down and we have reason to think so. So far as we can tell, National Assistance will be relied on for purposes quite different from those for which it was introduced. I crave leave to go back to the time when it was introduced and to remind right hon. and hon. Members of what it was said to be.
  On 24th November, 1947, the late Aneurin Bevan, when introducing the Bill which became the National Assistance Act, called it
  "…a national scheme to assist people in peculiar and special circumstances."
  He went on to say what he thought that they were:
  "There will be a number of persons who will not be eligible for insurance benefit. There will be some who will not be eligible for unemployment benefit, and there will be persons who will be the subject of sudden affliction, like fires and floods and circumstances of that kind, who will need to have help from some special organisation."—[Official Report, 24th November, 1947, vol. 444, c. 1604.]
  These were the purposes for which National Assistance was introduced and, as it was put in the same debate by my right hon. Friend the Member for Llanelly (Mr. J. Griffiths):
  "…the main job to be done under the provisions of this Bill will be to care for those people whose lives are so afflicted that they will not come inside the insurance field at all."—[Official Report, 24th November, 1947; Vol. 444, c. 1710.]
  Those were the purposes for which National Assistance was introduced. Accordingly, provision was made for National Assistance to be at a subsistence level and it is still the case that if one turns to the explanatory leaflet it will be found that one of the earliest sentences is
  "A grant can be made only to persons who need it."
  It was a scheme to meet special needs, and accordingly the scales—which are the maximum scales and do not include rent—together should be enough, and no more than enough, to provide a minimum subsistence benefit.
  If it were the case that only some small or varying proportion of the recipients of National Insurance also had to obtain National Assistance, I could regard that as a matter capable

  233
  of discussion. It might be due to some temporary circumstances. But out of those receiving National Insurance benefits at present, and for many years past, more than one-fifth have had to get National Assistance benefit as well. In those circumstances, how can it be said that National Insurance benefits are sufficient?
  Let us look for a moment at what is the position at present. As against the £3 7s. 6d. for a single man, the National Assistance scale is £3 3s. 6d. But we have to add the rent on to that. We get the rent figure from the National Assistance Board report. For a single person it amounts to £1 0s. 10d. and the result is a total of £4 4s. 4d. That is supposed to be the least with which a person in need can manage.
  We get the same picture on the married side. There is the National Insurance standard benefit of £5 9s. and, adding together the National Assistance figure of £5 4s. 6d. and rent of £1 3s. 7d., the result is £6 8s. Id. Both those figures are supposed to indicate the limit to which need can go. People cannot get along with less and, to the extent of one in five, they have to go to National Assistance. That represents an addition of roughly £1 to the National Insurance figures.
  Those figures fit in very well with what was said by my hon. Friend the Member for Sowerby (Mr. Houghton) in the debate on the National Insurance Bill on 28th January, 1963. He pointed out, as reported in column 621 of the Official Report for that date, that the Trades Union Congress had been asking for a pension for a single person to be increased from £2 17s. 6d. to £3 19s. 6d.. which is about the same as would be required to bring the present flat-rate National Insurance benefit up to the figure for National Assistance purposes which is composed partly of the rate and partly of the rent. He went on to say that that was the figure which had been asked for at the Labour Party conference in Brighton, in October, 1962. What is required is clearly indicated.
  I turn from that to appeal to hon. Members who are at present in the Chamber because they have a real interest and sympathy in these matters, to search their own experience and their own consciences. Do they really believe it pos-
  234
  sible for a single man today to live on the National Insurance benefit, or for a married couple to do so? I have given the figures and I shall not repeat them. Surely every hon. Member knows from his constituency experience that those figures are completely insufficient at present. I am not concerned at the moment with what they have been, or whether they have been increased, but with the one question, is any hon. Member prepared to say that those amounts are enough to live on and that they reach subsistence level?
  Mr. Gilbert Longden: I ask this for information. Was it the intention of Lord Beveridge, when these rates were first introduced, that they should be enough to live on, or should be only a supplement to people's savings?
  Mr. Mitchison: Lord Beveridge did not introduce these rates. They were not Lord Beveridge's rates and I have no idea what his intention was in the matter. He was certainly not in a position to carry it out. They were brought in as subsistence rates. I have read to the House the circumstances they were intended to meet, exceptional cases.
  I turn to another way of looking at the present system. We have at present an average earning of somewhere over £16. The last Ministry of Labour figure is £16 for an adult male worker in manufacturing industry and a very similar figure is given in one or two other industries. A man earning that amount, when he retires and is dependent on his pension, finds if he is single that he gets only about one-filth of his previous earnings. If he is married he gets only about one-third of his previous earnings. That is a terrific and cruel change. It is a matter which is becoming more and more important as the increasing wage level rises above the level of benefits.
  In other countries this is not the case. In Germany, I understand, a man on retirement gets more than half his previous earnings—I am talking in terms of averages. In Sweden, a man gets about two-thirds and in Belgium a man gets much the same. In Holland, I think that it is even higher, somewhere about three-quarters. In this respect, we introduce a bump from the comparative affluence—it

  235
  is only comparative—of average earnings to this extremely low level.
  Mr. Arthur Tiley: It is fascinating to compare the position here with that of other countries, but it is only fair to state the whole facts. For instance, in Sweden a man retires at 67, not 65.
  Mr. Mitchison: I quite agree with the hon. Member that there are all sorts of minor differences. If he goes through all the National Insurance schemes the hon. Member will find hosts of differences. There is almost every possible variety, but we in this country have a drop from earnings to National Insurance flat-rate benefits which is very much greater than the average. I was going to say, and I think that I should be justified in saying, that it is almost unparalleled in European countries. No one could regard that as right, or even faintly right.
  This being the position, what have the Government done about it, and what do they propose to do? First, they will tell us that they have made flat-rate increases. There is no doubt that they have. There is no doubt, also, that the real value of the standard benefit, the flat-rate benefit, has gone up. The point is that the rise in real valueof the flat-rate benefit has been considerably below the rise in the real value of wages and national prosperity, the national income. Instead of keeping the share they had—not very large though it was—before the succession of Tory Governments came to power, those dependent on fiat-rate increases have lost in the race. They slip further and further behind.
  It is somewhere about three-quarters of the actual national increase. I want to put it fairly to the House. The difficulty has been largely one of the whole concept of National Insurance. There have been three views about it. The first was that it was merely relief. The second was that it was some form of insurance. The third was that it was more than those; it was to provide for a reasonably comfortable old age. I deal with the insurance point first. It arose very well in a question put by one of his hon. Friends to the Minister on 2nd December.
  The Minister was asked by one of his hon. Friends:
  236
  "Can my right hon. Friend say what proportion of the National Insurance retirement benefit has been paid for out of contributions?"
  The right hon. Gentleman very wisely repied:
  "I should have to have notice of that very complicated question."—[Official Report, 2nd December, 1963; Vol. 685, c. 755–6.]
  The question certainly is complicated; it is unanswerable, for the reason that this is not an ordinary insurance contract. A number of contributions are being made by different people for benefits which, when they come to fruition, will almost certainly not be the same benefits as they would be today.
  There has been, and there was bound to be, with rising prices and the rising level of wages, some corresponding rise in the level of insurance benefits. It therefore presents to anyone who looks at it as an insurance question an entirely insoluble matter. There is no answer to that question. That is why the right hon. Gentleman politely burked it.
  The second view is that this is bare relief. This is the view to which the Government are increasingly tending. It is not, and never has been, the view of the Labour Party. We do not regard it as a matter of relieving people who are in need. We think that those exceptional cases of need ought to be dealt with by National Assistance. We regard it as affecting a far greater number of people—as the share of people in their old age of national prosperity, whatever it is; their share in the broad national income; their right to have, at the expense of the contributions they and others have made and the contributions which are due from their employers and from the Government, a reasonably comfortable old age. That is what we are asking for. It is a very modest request. I shall turn soon to what happens in other cases.
  I have been talking about the flat-rate benefit. I turn now to graduated contrbutions. These are no desperate novelty. They are the rule rather than the exception in most countries. They were put forward in this country by a Labour Party pamphlet, issued in 1957. What has happened about the idea contained in that pamphlet? What action have the Government taken about it? By 1959, the Government found that they were faced with a mounting bill

  237
  of Exchequer contributions. To get out of it, they have introduced a graduated contributions scheme, the effect of which is that the graduated contributors are paying what, according to bargain and according to all arrangements previously made, the Exchequer ought to be paying. Consequently, we are getting an arrangement under which the Exchequer, instead of losing very considerable sums, will, in fact, make a small profit some time ahead.
  I cannot do better than repeat what my hon. Friend the Member for Sowerby said in debate in January of this year. This was the debate on the last National Insurance Bill. My hon. Friend congratulated the then Minister on the extraordinarily good bargain he had made for the Exchequer. He said that the Minister deserved a good place in the City for it. My. hon. Friend said this:
  "If anyone likes to see a vivid illustration of this he has only to look at Command Paper 629 of 1959"—
  that was the Report of the Government Actuary—
  "to find out that the estimated deficit on the National Insurance Fund in the year 1981–82 was going to be £424 million, and if he will now look at the White Paper now before us, Table 2, he will see that in 1981–82 there will be a surplus of £122 million."—[Official Report, 28th January, 1963; Vol. 670, c. 621.]
  This was to come out of using the contributions of the graduated contributors. The graduated contributors are those earning between £9 and at present £18 a week. It was at their expense that the Exchequer was to be relieved of this increasing liability.
  There was no bones about it. The previous Minister had to address the National Association of Pensions Funds. He made it perfectly clear to the Association that that was the intention of the Measures then taken and that that would be their effect. So far the result has been that the Exchequer contribution, which used to be one-third of the total when the National Insurance Bill was originally brought in, has now fallen to about one-sixth or one-seventh of the total. That is the result of this raid on the graduated contributors. Yesterday, one of my Scottish hon. Friends, in a Question which received a Written Answer, asked the Minister
  "what proportion of total receipts to the National Insurance Fund came from
  238
  Exchequer contributions for the years ended 31st March, 951, and 1963, respectively."—[Official Report, 9th December, 1963; Vol. 686, c. 31.]
  We learned that during that period it had fallen from 26 per cent. to 16 per cent.
  If that is the way in which the Government are trying to meet the deficiencies in the amounts of National Insurance benefit, all I can say is that it is time they thought again. If it were generally known—I think that it is beginning to be generally known—that the Exchequer contribution has fallen from about one-third originally, first, to one-quarter and, finally, today to about 16 per cent., that, at the same time, the flat-rate benefits are considerably less than what is given on National Assistance, and that the graduated benefits are simply being used to meet the deficit that the Exchequer would otherwise have had to meet, people would be even more indignant with the Government than they are at present.
  It may be said that we cannot afford any more. In relation to that aspect, I want to say something about the employers' side of the picture. Some figures were published in the E.E.C. report about what employers do contribute by way of social security contributions in this and in other countries. The contribution of British employers works out at 5 per cent. of their payroll, whereas in every country listed here—Belgium, France, Western Germany, Italy, even Luxembourg and the Netherlands—it is never less than 13·65 per cent.—that is, nearly three times as much as British employers pay. In France, it amounts to 31 per cent. In Italy, it rises to nearly 45 per cent.
  Sir John Vaughan-Morgan: Will the hon. and learned Gentleman give comparable figures for the employee?
  Mr. Mitchison: Yes, if the right hon. Gentleman likes. In Britain, the figure is 5½ per cunt., in Italy, 5·40 per cent.: in France, 6·05 per cent.; and in Western Germany between 12 per cent. and 13 per cent.
  They are on the low side by comparison, but it is nothing like the disparity in the employers' contributions. If one puts it in terms of the average weekly

  239
  amount paid by an employer on behalf of an employee, one gets the same result, a result that is, perhaps, easier to follow. It is 15s. 9d. in this country, and in other countries it ranges from about double that in the Netherlands to about £3 13s. in France and £2 7s. in West Germany.
  The result is that, taking this country by comparison with others, instead of the original one-third, one-third and one-third arrangement, we now have an Exchequer contribution at a much lower rate and an employer contribution which compares astonishingly badly with that obtaining in other countries. I do not see why we should subsidise the British employer in international competition at the expense of the old folk of this country, for that is what these figures mean.
  Lord Balniel: The hon. and learned Gentleman's figures do not give a fair comparison unless, at the same time, one makes an equivalent comparison between the wage rates operating in the countries he quoted. The figures which he gave, in isolation, are utterly irrelevant.
  Mr. Mitchison: No differences in wage rates between that group of countries can possibly cover that sort of disparity. Is the noble Lord saying that West German pay is about two-and-a-half times less than ours? It is absurd to suppose that differences between pay rates in different Western European countries can account for this difference. What does account for it is the different view taken in different countries of the responsibility of the employer and the government towards old people. There is no denying that.
  Mr. J. Enoch Powell: Can the hon. and learned Gentleman say whether the contributions abroad cover health benefits as well?
  Mr. Mitchison: I do not think that they do. I cannot be certain about that, but I can tell the right hon. Gentleman, whose experience in this matter is unrivalled, that no addition of health benefits can possibly account for the disparity. There is an astonishingly large difference and, without committing myself to exact figures in a
  240
  matter of this kind—because there are differences in the various systems—the broad fact, an indisputable fact, remains; that our employers contribute far less towards retirement and other benefits.
  Mr. Tiley: I am the first to say that the hon. and learned Gentleman is always fair in debate. I am anxious to make it clear that in this country and throughout Europe our employers are not of the type that he is suggesting. The main difference is that our employers, without impetus from Parliament or anyone else, have introduced private schemes of their own volition covering 10 million of our workers—and that does not apply on the Continent.
  Mr. Mitchison: I appreciate the hon. Member's point and I shall have something to say about private schemes later. However, they do not cover the ground covered by the standard State scheme. All I am pointing out in answer to the question "Can we afford this or that?" is that there is the possibility—I go further, the advisability—of making British employers "cough-up" as much as their Continental rivals, allowing, of course, for the differences in incomes and other matters between the various countries.
  I now deal with what I believe the Government are planning to do. We have some guide to this in the terms of the Amendment which they propose to move today. They
  "…will have regard particularly to those groups whose need is greatest"
  As I understand it, that means that the Government are to accept what I call the relief theory of National Assistance and confine what is given to people to their needs, just as National Assistance does today.
  I have another indication of this. The right hon. Member for Enfield, West(Mr. Ian Macleod), speaking at the Conservative Party conference, at Blackpool, said—and I am quoting only sentences of his speech, although I think that I am giving the effect of his remarks fairly:
  "We accept too easily the structure of the social services. We must ask a much more fundamental question: should the wall of social security be the same height for every one?"

  241
  The right hon. Gentleman had been criticising my hon. Friends for doing some patching or replacing a brick here or there—or, in fact, doing exactly what the Prime Minister was doig when replying to a Question earlier today.
  The right hon. Member for Enfield, West, raised a broader point:
  "Should the wall of social security be the same height for everyone? Does it make sense when every year more and more of those retiring are covered by non-State pensions and other benefits?"
  That is to say, he proposed to rely on the non-State schemes to deal with all cases except those of sheer need. That is how I understood it. The right hon. Member went on:
  "I sense a feeling in this Conference that we may be doing less than we ought to do for those with special needs and problems because we insist on providing an average level of benefits for everybody".
  I am the last to say that we should not provide for special needs in special cases, but that is no excuse for turning what was originally intended to be a provision for comfortable old age into a provision merely for meeting acute needs. That is what the Government have in mind now, it seems. The right hon. Member for Enfield, West talked about his wall. We find, in "A Midsummer-Night's Dream":
  "…we must have a wall in the great chamber; for Pyramus and This by, says the story, did talk through the chink of a wall."
  It was the chink, I suppose, with which the Prime Minister was dealing today. Bottom then says:
  "Some man or other must present wall…"
  We had the man or other presenting the wall today. We shall no doubt have others, but all this seems to be getting far away from the original and right intention of the scheme.
  I do not wish to delay the House and I come, by way of illustration, to the sort of things we think should be done. If hon. Members are in any doubt about this they can perfectly easily obtain the pamphlet New Frontiers for Social Security and read in more detail than I have time today to relate the kind of things we propose.
  We propose, for instance, that those who are looking after the substantial reserve funds—and they are large amounts of money—standing to the credit both of National Insurance and
  242
  industrial injuries should be allowed to invest those funds just as the managers of life insurance and similar funds. They are not restricted by a statutory obligation to buy only Government stock and they make use of their freedom. They put advertisements in the newspapers about the excellence of the benefits they offer and how that depends on their freedom of action.
  Hon. Members opposite say, "Yes, the insurance companies, the private employers, may do this. They may invest as they choose. They may draw their trustees as they choose. Only the Government in dealing with the poorer people, the mass of citizens in this country, are bound not to exercise that facility of investment." The suggestion is in those advertisements that they lose by doing it. Whether or not they do, I see no reason why they should be constrained in that way.
  We propose to change the contributions. At present, they are a fixed amount up to £9, then they consist of a fixed amount plus a graduated addition, and then they disappear on the upper limit of £18. We propose to make them a percentage right down to the bottom, but not right up to the top. We shall have a high limit and see that it is high enough because, for the benefit of the fund, it is right that we should bring in some of the people who are not at present brought into the Government scheme.
  We propose to change the basis of the Exchequer contribution and to make that depend on the national income, that is to say, to make it a percentage of the national income, and we shall in that way have hitched the contributions partly to individual earnings and individual pay rolls—that is, in the case of the employers and the employees—and partly to the national income itself.
  Surely, if we are to make the benefits depend, as we are to make them depend, on national earnings—the average earnings of people in manufacturing industries—it is right and prudent that contributions should have a similar dependence.
  Sir Spencer Summers: Are we to understand that the benefits are not to be linked to the cost of

  243
  living, but to the contributions paid into the fund?
  Mr. Mitchison: I would not understand anything yet if I were the hon. Member, because I have not got to the benefits. I was talking about contributions. I think that I can answer the hon. Member's question completely. If he finds that I have not, and he cares to intervene again, I shall gladly give way.
  Let me turn to benefits. Taking retirement benefits, which represent the largest number of people affected, and the highest amount affected, they ought to be adjustable in the sense that year by year they should follow the same index to which I have referred—the average earnings in manufacturing industry. Next, the graduated retirement benefit, which will come on top of the fixed amount to which I have referred, should be a percentage either of contributions or of earnings, since the contributions are themselves to be a percentage of earnings. We propose to provide that those contributions should be taken to continue during sickness and unemployment. We propose, transitionally, to allow for an increase in the case of older people who will not by reason of their age have had the opportunity to establish their full paying position in the fund. We propose, further, to add the amount which has already accrued to graduated contributors under the present scheme, that is, a vested right to which they are entitled.
  We also propose to supplement the income of everybody who needs it, under the guaranteed incomes scheme to which the Motion refers.
  I desire to say a word or two more about that. The intention is that the income there should, broadly speaking, be the income subject to tax. Accordingly, we should not take account of war pensions, savings bank deposits, and so on, which are exempt from tax. There should be some disregards, generally speaking, those that apply to National Assistance at present, and the income of everybody which falls short of that amount should be made up to it.
  Mr. Percy Browne: To put it in a nutshell, the hon. and learned Gentleman is saying that he would have
  244
  a universal means test for retirement pensioners.
  Mr. Mitchison: I fully appreciate the force of what the hon. Member says. This is not a matter to decide on a play of words. The point is that Income Tax itself is a means test. P.A.Y.E., and so on, are all means tests in one sense, but, of course, means tests can be used in two ways. A means test can refer to need and it can refer to one's income.
  All we have to find out here is what a man's income is, or a married couple's, and make it up to the required amount. In a sense one can say that it is a means test, just as an Income Tax return is a means test, but it is in a quite different sense from what it has been in the past, and, in practice, it comes to a very different matter indeed.
  The majority of people who will be concerned in this will be subject to this means test, if we like to call it that, under their existing P.A.Y.E. arrangements. All that we have to do is to turn our Income Tax arrangements in reverse. Instead of taxing people according to what they get, let them receive according to what they need. If one works this out in detail, there are obviously new things to be introduced—not many, I think—which should fit in clearly, and, I hope, to the understanding of those concerned, with the present arrangements for collecting tax and be tied to it as closely as possible.
  Mr. P. Browne: I hope that the hon. and learned Gentleman will accept that I was not interrupting to make a play on words or a party point. This is a point of view which I and many of my hon. Friends have held for six years. I was trying to make quite sure that the hon. and learned Gentleman was saying what we have pressed for. This was suggested by the hon. Member for Sowerby (Mr. Houghton) in the debate last year.
  Mr. Mitchison: That is perfectly correct. My hon. Friend the Member for Sowerby put it forward, and I accept from the hon. Member that he supports the idea. I am very glad that he does. This is not a matter that we want to debate in terms of slogans, or anything of that kind. We are dealing with old people who have not enough to live on, and we are trying to make their lot more comfortable. Let us for heaven's

  245
  sake not get this thing cockeyed by putting the wrong label, or the right label in the wrong way, on it. Let us look at the scheme on its merits.
  I turn to unemployment and sickness. These are two benefits under the existing arrangements, and I think that the main points we have in mind are two: first, to lengthen the temporary period which is now about half a year, or 180 days' entitlement to a full year; and, secondly, to provide for continuing benefit after that. The continuing benefit would be in this case, as we see it, at flat rates—proportions of the average earnings of the male adult worker—and adjustable in the way that I have indicated from year to year because average earnings themselves vary from year to year. The proportion we have in mind is one-third in the case of the single man and one-half in the case of a couple. We have the strongest support from the N.E.D.C. on unemployment. In conditions favourable to faster growth the N.E.D.C. came out in very definite terms in favour of a wage-related scheme to deal with unemployment and to maintain that ability to move from place to place and job to job which it recognised as being so essential to the country in modern conditions.
  Widows' pensions and allowances are a very complicated matter, and in view of what was said today it seems likely that there will be legislation and Orders about them. First, we think that the widow's pension—the one that she gets immediately on her husband's death, and which is called the widow's allowance—should also be a flat rate added to a proportion; say, one-half of the husband's former earnings.
  We propose, too, that the earnings rule should be abolished. As I see it, there can be no messing about with the earnings rule. I agree that there is much to be said about it on both sides, but, on the whole, the rule is unjust and is not worked properly, and it is recognised that something must be done about it. I think that the right and the simplest thing is to abolish it.
  I turn now to contracting out. There are conditions at present allowing for contracting out of the Government's graduated scheme, and there are three ways in which we think the alternative
  246
  private schemes may break down; two, where they may break down and one where they very often do break down. The two where they may break down are the provision for widows and the provision for deferred retirement.
  The third, which is the one that I emphasise most of all, is that the pensions are not by any means always fully transferable; that is to say, a man does not carry his pensions rights on his back on going from one employer to another. It is, however, perfectly simple to enforce that. It can be done either by a provision in a National Insurance Bill, when it is introduced or, as an alternative—or, perhaps as an addition—by restricting the very considerable tax concessions at present given to these schemes in cases where there is full transferability.
  After all, a very large number of people, the estimate was over 1 million but we shall probably get the answer in detail later, lost their pension rights in recent years by moving from one employment to another. The facts about this are extremely difficult to ascertain, largely, I think, because of the variety of the schemes involved. If the Minister can tell us something about it, I know that my hon. Friends and myself will be grateful. We should like to know how many people are involved in what sort of private schemes, and how many of them loss their rights by moving from one job to another either last year or in a previous year. What is the position about transferability, and do the Government propose to do anything about it?
  The figure is very considerable. The right hon. Gentleman will remember that the Phillips Committee, some time ago, was unable to give any accurate figure at all. Quite obviously, it had not the requisite information for the purpose, and spoke of about £100 million a year being involved. I do not know where the Committee got that figure from, but I do know that attempts to find out on what it had founded that figure were quite unsuccessful. Anyone doubting that should read what Professor Titmuss has written on the subject.
  I hope that I have shown that we on this side find the present system quite unfair and insufficient; that we see no

  247
  reason why there should not be a perfectly feasible and workable—and fight—alternative on the lines I have indicated; that we believe the purpose of this kind of provision is to secure a comfortable old age, not just to relieve need or get muddled up with insurance arrangements.
  This is also an urgent matter. These people have not enough to live on—and they have not enough to live on now. They are not getting enough. There are old folk in the constituency of every hon. Member who are really getting an insufficiency of food, heat, or whatever it may be. They are not able to live a reasonably comfortable life. We in this House are defaulting, here and now, in our duty to them. It is up to the Government to do not only what I suggest should be done in the long run, but something immediately, while winter is on us.
  I could cite a lot of cases, but I will only mention one because I know that it affects a great many of my hon. Friends who are miners, and who know the facts. For some reason, crippled miners cannot at present get about in Government-provided tricycles or bicycles with engines to them. For some obscure reason, war pensioners can. Industrial injuries do not give the same rights as war injuries, but why not? These people are in substantially the same position, and I am sure that, if he gets the chance, one of my hon. Friends will develop that point further.
  That is just one instance of hardship, but there are other instances which I am sure my hon. Friends—and, I hope, hon. Members opposite—will develop as the debate proceeds. Whatever be the faults of the present scheme, whatever be the merits of the alternative scheme, there is an immediate and urgent human need to do something for these old folk now that the winter is coming on.
  4.57 p.m.
  The Minister of Pensions and National Insurance (Mr. Richard Wood): I beg to move, to leave out from "House" to the end of Question and to add instead thereof:
  "notes with satisfaction the many improvements made by Her Majesty's Government which have given national insurance and other benefits a greater value than ever before;
  248
  welcomes the Government's examination of the possibility of further developments in relating benefits to earnings; and is confident that the Government will continue to improve benefits, and in doing so, will have regard particularly to those group3 whose need is greatest".
  The speech of the hon. and learned Member for Kettering (Mr. Mitchison) contained such a collection of facts that seem to be at variance with the information at my own disposal that perhaps I had better first try to explain what the Government have already done, because it is not by looking directly at shadowy and uncertain plans for the future but by examining the developments that have taken place since the war under Socialist and Conservative Governments that it is easiest to make intelligent judgments between them.
  We took over the administration, 12 years ago, of a system under which the 26s. basic rate of pension had very recently been increased to 30s. for most retirement pensions and for widowed mothers' allowances. The equivalent of that 30s. at today's prices would be 43s. 6d., which compares with the present basic rate for a single man of 67s. 6d., representing an increase in real terms of 55 per cent. The real increase for a married couple is very slightly less than that.
  I will not go into the details of every successive step that has been taken since 1951, but will come immediately to the improvements made earlier this year. Between April, 1961, and May, 1963, the Index of Retail Prices rose by nearly 8 per cent.; retirement pensions were increased last May, not by 8 per cent. but by between 17 per cent. and 18 per cent. Since then, that price index has fallen slightly, so that, today, the rates represent a higher real value than they have ever represented before.
  But, even more important than the increase in the pension's real value in terms of prices, is its comparison with average earnings, and the hon. and learned Member for Kettering dwelt on this for a short time. Unlike both the Labour and the Liberal parties, our party made very few promises in this context at the last election, but what we undertook to do was to continue to give pensioners a share of the increasing national prosperity.
  The hon and learned Member for Kettering quoted some rather different

  249
  figures or suggested a rather different conclusion, but between 1951 and 1963, which a week or two ago were called "12 wasted years", while men's average earnings have increased by 95 per cent., the retirement pension for a single man has gone up by 125 per cent. At the same time as the real value of the pension went up by more than half, the number of pensioners, as I made clear the other day, also greatly increased. In 1951 there were just over 4 million and there are getting on for 6 million today, that is seven pensioners for every five there were 12 years ago.
  The consequence is that the cost of all benefits now is far greater than it was then. The total cost of all benefits has gone up by three times and of retirement pensions by about three and a half times. More important is the proportion of the national income spent on these benefits. In 1951, we spent 2·3 per cent. of the national income on retirement pensions and in 1962 we spent 3·6 per cent., which is almost half as much again. Since the rise in the rates earlier this year the percentage will have risen still further.
  The hon, and learned Member for Kettering this afternoon, and in Questions to me the other day, drew atten-to the large proportion of retirement pensioner householders who were receiving supplements from the National Assistance Board last June. I explained last week that the proportion of retirement pensioner householders on assistance, at 22·6 per cent.—which was the figure I gave the hon. and learned Member—was almost exactly the same as was the proportion in December, 1951. The truth is that a real lead existed in the early days of this scheme, but that lead was destroyed by the increase in National Assistance in 1948 leading to the kind of proportion I have mentioned, which has fluctuated over the years but is now the same as it was 12 years ago.
  The proportion who are receiving a supplement clearly reflects the policy followed over a number of years of increasing both the insurance and the assistance rates. It would be easy, therefore, as I tried to explain to the hon. and learned Gentleman, to reduce the proportion by increasing National Insurance benefits without improving the
  250
  assistance scales, but the effect of this would be to give little or no increase to the poorest pensioners. All it would mean would be that they would get more of their total income on the pension order book and less on the National Assistance order book, and the extra contribution and the Exchequer payment, would go mainly to improving the position of the pensioner who was relatively better off.
  The Motion calls for a system of wage-related benefits. There is no mention in it, and there was not very much mention in the hon. and learned Member's speech, of the scheme of my right hon. Friend the Chief Secretary to the Treasury which relates retirement pensions to earnings. Admittedly, my right hon. Friends scheme is not exactly the scheme which the party opposite approves, but perhaps it is none the worse for that.
  The scheme which my right hon. Friend introduced is intended to allow full freedom for private and occupational provision, and in the 1959 Act graduated additions to flat-rate pensions were deliberately introduced at a modest level so as not to discourage private provision and to provide a reasonable system of contracting out for those who had an occupational scheme. The Act this year continued that policy by extending the scope of the graduated scheme broadly in line with the rise in average earnings since the scheme was first announced in 1958.
  I admit to having read New Frontiers For Social Security three times, and I still have a good way to go in understanding the whole problem, but I understand that the scheme of the party opposite is planned to come to full fruition when the growth in occupational schemes, which now cover between 9 million and 10 million workers, would mean that private pensions were being paid in addition to State benefits to a large number of people retiring from work.
  It is difficult, frankly, for me to see how these occupational schemes would survive under the scheme of the party opposite. It is certainly true that in "New Frontiers" it is envisaged that contracting out would be possible, but as very high contributions on a wide span of earnings would be involved as well as

  251
  fairly extensive redistribution, it is difficult to see what would happen to the system of contracting out. Under the Labour Party's scheme, the State would be making the main provision, but the popularity of occupational schemes since the war does not suggest to me that people are particularly anxious that the State should do that. We all agree that it is right for people to have adequate provision, but it is very much less easy to show that it is right to compel them to allot a high proportion of their income to provide high benefits. People may want to use their resources in some other way.
  Mr. R. S. Crossman: Is the Minister referring to the employer or to the employee when he speaks about a decision? It seems to us that the decision is taken not by employees but entirely by employers. These occupational pension schemes are conditions of service. They are not voluntarily chosen by individual employees.
  Mr. Wood: That is perfectly true. All I say is that people have different wishes in this matter, and there are a number of people who will want to use their resources in another way. If I may help the hon. Member in his question, I would say that some people will prefer to contribute to an occupational pension scheme, whilst others will want to devote resources to buying a house for their old age or to bringing up their children, from whom often they will receive help later. But if the overall burden for future pensions is drastically increased it is certain that some of these other outlets must be curtailed.
  Mr. Ernest Popplewell: This is a very important point. The Minister refers to "some people". Whom does he mean? Does he mean the employers' organisation or the employees' organisation? The Minister will understand that it is not the employee who opts in this direction. This is the employer's decision. Would, the right hon. Gentleman go into this matter more fully and make this clear?
  Mr. Wood: It is clear that employers introduce these schemes only if they are thought by them to be to the benefit of their employees. That seems to me to
  252
  be a perfectly clear answer to the hon. Member, and that is the answer I stand by.
  It is impossible for me to gather from the information given so far by the party opposite the extent of the increase in contributions which is likely to be necessary under their scheme. I read New Frontiers expecting and hoping for greater enlightenment, but I could not find in it any figures, which seems a sad retraction from the party's last publication, National Superannuation, which at least contained some figures. So far, we have little enlightenment on this scheme. I hope that in the course of the debate the hon. Member for Coventry, East, may be willing to answer some of the questions which New Frontiers has left tantalisingly in suspense.
  To turn from the long-term to the short-term benefits, the House will be aware—
  Mr. Mitchison: Before the right hon. Gentleman goes on, will he deal with transferability? It is very important.
  Mr. Wood: I think that it would be easier if I left that important subject to my right hon. Friend, who will deal with it with his usual skill later in the debate.
  The short-term benefits occupied a considerable and important part of the hon. and learned Gentleman's speech. The House will recall that the N.E.D.C. Report, Conditions Favourable to Faster Growth, referred to the possibility of replacing the existing National Insurance scheme by a scheme of wage-related benefits. The Council said that a higher level of benefits in relation to earnings would substantially reduce the financial hardship of unemployment, but it saw, at the same time, that a fundamental reorganisation of the existing system would be involved and that it could not be brought about quickly.
  My predecessor began an examination of proposals for a scheme of short-term benefits related to earnings. I have myself had talks with the British Employers' Confederation and I hope to meet the T.U.C. next week. When I mentioned these discussions at Question Time a week ago, I pointed out that the issues were bound to be complicated and that it would be hard to make rapid progress.

  253
  The present scheme is heavily weighted—and I think that it is generally agreed that it should be—in favour of the married man with children. A married man with a large family can at present receive, when out of work, a substantial proportion of his earnings where those earnings are at about the average level. And fathers of large families whose earnings are below average receive an even higher proportion when they are ill or out of work.
  Another important set of problems is this: how is it best to assess previous earnings? How long should the period be over which the earnings are assessed? What earnings should be taken into account? Which is the quickest and best way to get the information? Clearly, all these are important questions which we have to answer.
  A recent record of earnings could be obtained only from employers. In 1962, there were 3£ million claims for unemployment benefit, which would be certain to mean millions of inquiries and a large burden placed upon employers, with a real danger—there are these dangers—that payment of benefit would be delayed. Also, we should have to decidehow to collect the graduated contributions necessary to support benefits. Still another and wider question is whether this kind of development could or should be restricted to unemployment benefit. Sickness benefit and unemployment benefit are closely linked in the present scheme and there would be difficulty in treating the sick differently from the unemployed.
  On the other hand, sickness benefit claimants normally have a job to return to. A recent inquiry by my Department showed that more than half the workers of this country are covered to some extent by employers' sick pay schemes. Relevant also are the number, the frequency and the temporary nature of sickness benefit claims; and the relation to earnings of 9 million claims a year—as there were last year—would present considerable difficulties of administration.
  Apart from this important examination now being carried out, there is a wide choice of directions in which benefits might be developed in the future. I have found no shortage of ideas since I returned to the Ministry of Pensions.
  Mr. Mitchison: I am sorry to disturb the right hon. Gentleman again, but do I gather from what he has said that the examination, with all the resources of the Government behind it, has not extended tc any questions of cost?
  Mr. Wood: I am not quite sure what the hon. and learned Gentleman means—the cost of the scheme?
  Mr. Mitchison: The right hon. Gentleman was inquiring about the costs of the scheme in New Frontiers for Social Security, think that he forgot that I had made several references to them. I am asking now, if the Government are thinking of a scheme, what it is to cost and who is to pay for it.
  Mr. Wood: Certainly, that is one of the considerations, and I had hoped that, even if I had not mentioned it, it would be clear that the financing of the scheme and its cost would be important questions. But the questions which I am investigating with the B.E.C. and the T.U.C.—I think that they have a right and a duty to give their views—are the questions which I have already mentioned, and they are the ones I am trying to make progress with now.
  As I say I have found no shortage of ideas about what should be done in the future. Hardly a day goes by without someone giving me the benefit of his or—perhaps even more often—her wisdom. The most recent letter of advice which I received, evidently written by someone who thought me unlikely to take it, ended with the cheerful woods, "Such like as you want putting to bed with a shovel"—a sentiment which will, perhaps, find echoes of approval opposite. But I am at present doing my best to digest all the advice which I have received, though I am not ashamed to admit, that after 50 days, I am suffering from acute indigestion.
  The first possible direction of advance in the future is to try to improve benefits for identifiable classes of pensioners. We have had the announcement by my right hon. Friend the Prime Minister today. The Government have considered for some time the National Insurance provisions for widowhood, and they are conscious of

  255
  the natural sympathy which exists in the House for women whose husbands have died and who are left with children to bring up. Consistently, over recent years, with the approval of the House of Commons, we have given to these widows preferential treatment. The purpose of my right hon. Friend's statement was to make clear that we intend to carry this preference rather further.
  Widowed mothers already have higher rates of child allowances than other National Insurance beneficiaries, and these allowances are exempt from the earnings rule. This gives help to all widowed mothers, especially those with larger families. We have now decided, as my right hon. Friend made clear, that the payment for a widow's child ought not to be any less than the payment to the guardian of an orphan, and we propose, therefore, a new allowance for the child of a widow of 37s. 6d. instead of the present amounts, which include family allowances, of 30s. for the first and second child and 32s. for subsequent children.
  The second improvement we have in mind relates to the age up to which child allowances can be drawn. There are many more children now staying at school beyond the age of 18, and many of them expect to go on to a university. When the age was raised from 16 to 18 in 1957, this was not nearly so common, but I am now concerned by the growing number of widows who lose their allowances when their children reach 18 years of age although the children's schooling continues beyond 18.
  This, naturally, as the House will have perceived, affects the children of the sick and the unemployed—it affects children generally. Therefore, the proposal is to raise to 19 the age to which child allowances for both National Insurance and Industrial Injuries beneficiaries, and family allowances, will be paid for children in full-time education.
  Mr. Harold Finch: Does that include apprenticeships?
  Mr. Wood: It includes apprentices, as at present, who are earning less than 40s. a week. It is on exactly the same basis as before except that it goes on for another year.
  Dr. Jeremy Bray: Why does the right hon. Gentleman choose 19 years of age? Since he is changing the age, why not make the regulations consistent with those which apply to Income Tax, under which the age is higher?
  Mr. Wood: We considered this very carefully. We thought that the extension of the age limit by one year would take care of most of the boys and girls in transition from school to university. We thought, to be perfectly frank, that if one goes any higher one runs into more and more difficulties such as where children leave home and where the widowed mother's personal allowance would, therefore, be affected by factors rather out of her control and certainly out of the Government's control.
  May I explain, because I think that it is important, the position about the widowed mother's personal allowance of 67s. 6d. This is paid when her child has left school.
  Mr. John McKay: I assume that the right hon. Gentleman is aware that we leave the door open for youngsters who are below the age of 16 to leave school. To that extent, we encourage them. In view of that, is it not a terrible thing that we should say to the child of 15, "You can get work if you can, but if you cannot you will get nothing from the Welfare State except what your father is receiving by way of National Assistance"? Does not the right hon. Gentleman think that that situation wants remedying?
  Mr. Wood: The Hon. Member seems to be raising a very much wider issue. I do not believe that anything I have said this afternoon is an encouragement to children to leave school earlier. It seems to me, if anything, an encouragement to children to remain at school longer, because their mothers will now be able to draw allowances for another year.
  I should like to explain the position, which I think is important, about the widowed mother's personal allowance. This is paid even though her children have left school but when the child is still under 18 and living with her. This will now continue to be paid if the child remains living with her until the age of 19.

  257
  The third and last improvement is the further relaxation which is now proposed in the earnings rules. There has been a great deal of discussion about the complete abolition of the earnings rule for widowed mothers, but, as hon. Members who understand this scheme will realise, there are great difficulties here in the context of the present National Insurance scheme, the purpose of which, in general, is to provide benefits in the absence of earnings, even though a certain level of earnings is disregarded.
  Mrs. Harriet Slater: Does this relaxation apply only to widowed mothers, or does it apply to widows as a whole?
  Mr. Wood: I am sorry that the hon. Lady did not wait for a few seconds, because that point is dealt with in almost my next sentence.
  To pay benefit on top of earnings, however large, would change fundamentally the character of the present provisions. Therefore, what we have always tried to do is to set the earnings limits as high as reasonably practicable. We think that the present limit—here I come to the hon Lady's point—for widowed mothers of £6 should be raised to £7. We also think—and I hope that this answers the point—that some corresponding relaxation should be made in the earnings limit for widows and retirement pensioners, from £4 5s., as at present, to £5.
  I should like to say a few words about the 10s. widow. Although no proposal has been made by my right hon. Friend, this was a matter in which interest was expressed by the right hon. Gentleman the Leader of the Opposition.
  Sir S. Summers: Before my right hon. Friend leaves the matter of the earnings rule, may I put this to him? He has told us about the intended change for the widowed mother and widows. Does he intend to make no change in respect of the retirement pensioner?
  Mr. Wood: I am sorry that my hon. Friend did not hear what I said. I said that a relaxation should also be made in the earnings limit for widows and retirement pensioners, from £4 5s. to £5.
  Sir S. Summers: The figure is £3 10s., not £4 5s.
  Mr. Wood: I will have a talk with my hon. Friend, but I think that he has the figures wrong.
  May I explain the position of the 10s. widow. The House will be well aware of the effect of the new scheme introducer by the party opposite in 1946, which made long-term benefits payable only to those widows who cannot reasonably be expected to support themselves by their earnings, those who have young children to look after, and those over the age of 50 when they are widowed or when their children grow up.
  There are two main classes of widows receiving a 10s. weekly pension. The first covers those who were already receiving the pension before July, 1948, and who did not then qualify for the new benefits, and the second those women who were already married before July, 1948, to men insured under the old scheme and who, on subsequent widowhood, did not qualify for a pension under the new scheme.
  What this Leader of the Opposition was suggesting was an increase in the 10s. widow pension, but I want to make it perfectly clear to the House that suchan increase would only enlarge the disparity between the widows who are entitled to the 10s. pension and, on the other side, those widows whose age and family circumstances at widowhood are identical but who, under the new philosophy of widowhood, get no long-term benefit at ell. That is why consistently, and I am sure rightly, the Government have taker the view that it would be wrong to increase this pension and enlarge the disparity between those who receive it and widows in similar circumstances who do not.
  Mr. Bernard Taylor: The Minister has made some observations about the 10s. widow. Has he any observations to make about the 20s. widow who comes under the Industrial Injuries Act and who, like the 10s. widow, has had no increase since 1948?
  Mr. Wood: I have nothing to say other than what I have already said, or to add to what my right hon. Friend the Prime Minister said before the debate began.
  Since, no doubt, they will figure largely in the debate, I will leave my right hon. Friend the Chief Secretary to the Treasury to deal with two major

  259
  questions. One of them has been raised already, namely, the Labour Party's R.A.Y.N. scheme—"Receive As You Need"—which the hon. and learned Member for Kettering explained to us, arid the other is the relation of National Insurance benefits to any kind of means test.
  In order not to take up too much time, I merely look at one other possible direction in which we may advance in future. This concerns the conception of National Insurance benefits as a foundation of total income. Many of the schemes which have been put before us, the R.A.Y.N. scheme among them, and which have attracted the widest publicity, contain a number of serious problems and objections. Some of them, even if adopted, would take time to bring into effect. Meanwhile, it seems to me sensible to build as soundly and robustly as we can on the foundations which already exist.
  In a world which is changing and a society which is developing, it is clear that our social provisions cannot remain immobile. They must also change and develop. But, when talking of our social security system, it is very important to remember that we are dealing with the rights and expectations built up over many years by millions of our fellow countrymen, and any changes that we make must respect those rights and expectations; and I think that this is the first requirement. We cannot drastically alter the system merely by the stroke of a pen. I know that this is frustrating sometimes to vigorous and radical minds.
  The change must take the form of adaptation to society as it changes. This adaptation has been going on over recent years. We have had the general development of special provisions for widows with children, which I hope, will receive a fresh impetus from the proposals which I have described this afternoon. We have also had the introduction in the last few years of the graduated pension scheme, and we are now considering, as I have made clear today, further developments in earnings-related benefits. At the same time, we have and are developing a system which still leaves room for savings, for thrift and for individual provisions both for old age and for other eventualities.
  260
  The quality of self-reliance is one which we all think well worth preserving and encouraging in our modern society, but it is right that the State should provide a firm basis on which individual effort and enterprise can build. That firm basis exists in our social security system, which we as a Government have strengthened and improved over the past twelve years. Our record, we claim, is a good one and can inspire confidence that we shall continue our policy of steady improvement of our social insurance provisions.
  Finally, I must draw the attention of the House to a comparison which, I hope, hon. Members will find as instructive as I do. The Motion of the Opposition today is the tenth such Motion which they have moved since 1951, yet in the five years after the scheme began the Socialist Party made one small increase, which was limited to some retirement pensioners. The Conservative Party in opposition moved no Motions, but in office has made five increases in pensions and insurance benefits generally. I hope that the House and the country will draw the appropriate conclusion.
  5.31 p.m.
  Mr. R. H. S. Crossman: All of us, listening to the Minister this afternoon, agreed and sympathised with him when he spoke of being plunged for the first time into this subject, which is a complicated one. We all congratulate him on the clarity with which he has expounded what I well know it is not easy to be clear about. He has made it easy to begin the backbench debate.
  I start straight away with the Minister's central thesis at the beginning of his speech. He said, quite fairly, that the choice before us was between a scheme which basically relies upon the employer to provide a really full level of old-age pension or sickness benefit and a scheme which relies upon the State. The Minister prefers a scheme under which the State puts down the basis or foundation, on which the good employer will build.
  The right hon. Gentleman spoilt his argument at that point by suggesting that we are making a choice between a scheme in which we compel people to pay contributions to the State and

  261
  an arrangement in which people are free to join a superannuation scheme. This is a somewhat naive description of what goes on in industry. The Minister was proud of the nine or ten million workers in contributory schemes. There still are, I agree, a few contributory schemes which are genuinely voluntary, but the vast majority of employers' schemes are conditions of service and they are compulsory upon the worker in the industry. It is not proper, therefore, to make that division and to say that whereas the Conservatives, by favouring private superannuation, favour freedom of choice, we on this side are in favour of compulsion. They are simply different forms of compulsion or compulsory saving which we are now considering.
  Let us all be quite clear that personal provision for old age by free choice is done by a small fraction of people who take out an insurance policy; from them it is genuinely vòluntary. Anybody who takes out an individual life insurance policy is voluntarily choosing to save for his old age. Everybody, on both sides of the House, agrees that this is something to encourage and that every individual must be allowed the right voluntarily to put away part of his earnings for the sake of insuring his life or his old age.
  The issue which we have to face, however, is that in addition to voluntary life insurance, which is an important private element, we all agree now that there has to be compulsory group saving. We on this side believe that the State should create the basis for it in a State system, whereas the Minister prefers private employers to do it. I spoke to a good many private employers about this, and one thing which has changed a great deal in the last five years is the attitude of the progressive employers to private superannuation schemes. They are now ready to wonder whether such schemes are an unmitigated advantage to themselves.
  In a period of inflation and rapidly rising wages and prices, employers are constantly finding that they have to put their hands into their pockets and pay out vast sums to satisfy their older employees, who are overtaken by circumstances, as the employees of the State are sometimes overtaken, and who
  262
  find that they went out ten years too soon and are now starving under what they have got. There is a growing belief, even among employers, that not only the foundation but also the first floor must be with this State. I wanted to put the debate in this form to eradicate what was, I thought, one of the few unfair things that the Minister said, which was a false distinction between freedom of choice, on the one side, and compulsion, on the other side.
  I turn now to the two objections to the Minister's solution. His solution is for the State to provide a low level of insurance—deliberately to keep its own graded scheme low so as to encourage employers to introduce a scheme of their own. The effect of this is two nations in old age. The Minister proudly states that half the people are in employers' schemes. That means that half are out of them. This is a question which must be faced frankly.
  The Minister knows as well as I do that in the building trade, for example, there is virtually no superannuation. If a person chooses to join the building trade as a worker he will get little at the end of his service unless he goes to National Assistance. That is his fate as a worker in the trade. But if his friend works as a coal miner in a nationalised industry, lie has a quite good superannuation scheme.
  There is no evidence to suggest that if we wait another 20 years all employers w 11 automatically insure their workers for half pay. I remind the House also that of the 10 million workers who are in private schemes only a minority are in schemes which really give adequate security in old age, only a minority get 60 or 65 per cent. of their pay. A very few may get 75 per cert., as a town clerk does. The school teacher does fairly well, as do a number of municipal servants and a number of the servants of LCI. But the vast majority of workers, even in private schemes, receive far less than the half pay on retirement which we believe to be the minimum which should be provided for everyone.
  It is not tolerable to suggest, as the Minister suggested, that we should deliberately keep down the State level of insurance so that employers will be encouraged to introduce private

  263
  schemes. That means deliberately forcing on to National Assistance millions of workers whose employers will never be induced in their lifetime to go in for a private scheme. That is the effect of the Government scheme.
  I have a certain feeling of exasperation with these debates, because they all take the same form. The new Minister comes along and, having read his brief about the history of pensions since 1945, asks for more details of the Labour Party's scheme. Then he adds, "I am feeling my way and I have a few little ideas which I will ventilate." Thus we have the strange spectacle of the Conservative Government ventilating ideas and relying on the Opposition to work out a practical scheme. [Laughter.] Very well. We will now consider what the right hon. Gentleman did today.
  The Minister said that he was airing views on a wage-related scheme for redundancy. He produced nothing practical. He gave no figures. He said that there were difficulties and that this was as far as he could go today, since he was feeling his way. I take it that the redundancy scheme is to be spatch-cocked on to the Government scheme as the graded pension scheme has already been spatch-cocked on.
  I beg the right hon. Gentleman to have mercy on the civil servants. Ministers relied on their civil servants in this Department to draft the graded pension scheme. The civil servants knew that they would get bad value for their money and they have all opted out. They know a good scheme from a bad one. Their attitude was afterwards, "We must get out at all costs because it gives bad value for money." Yet each of them in the right hon. Gentleman's Ministry has had to suffer under the bureaucratic nightmare, of a graded pension scheme spatch-cocked on to a flat-rate scheme, plus contracting out.
  Every change in the rate of benefit and contribution means that every employer who contracts out has to recalculate whether his men are still in or out. Each time, millions of cases have to be considered by the Ministry, which has to trace every individual throughout his life. Every week these tiny sums have to be added together, as the Ministry
  264
  traces our fragmentary pensionable lives, year by year, until a miserable sum like 5s. 2½d. is added to our pension when we retire at 65. And this is called "Conservative pragmatism".
  The fact is that the flat-rate system is totally out of date and unjust, and merely to put something else on top of it is neither efficient nor just but a typical failure to think clearly. Of course, the right hon. Gentleman is right in saying that we must keep our obligations to pensioners and contributors. Of course he is right to say that every change has to be related to the past in such a way that we do not break our promises. We all agree with that proposition.
  It is now seven years since we first put forward our scheme for national superannuation. It was a clear-cut reconstruction of the pension structure on clear principles, and it was infinitely preferable, both injustice and bureaucratically, to what is now going on. But what happened? The Government said of our scheme that it was an idiotic invention by a skiffle group. Yet later they introduced their own graded pension scheme. But they deliberately made it so bad that everyone was compelled in his own interest to contract out. The number of people who have contracted out is three times as great as was originally estimated by the Government.
  Having introduced such a scheme, they now have to administer it, bad as it is. It takes as much trouble to administer a bad scheme as it takes to administer a good one. In our Motion we urge the Government to make a clear reconstruction of the pension structure on rational lines. The Government have already introduced a miserable little graded pension scheme. They are now trying to work out a quite separate graded redundancy scheme. Why on earth can there not be an overall scheme for graded benefits and contributions for sickness, redundancy and old age?
  We have put forward proposals for the clear-cut substitution of graded contributions and benefits for sickness, redundancy and old age for the present flat rate scheme. The Minister concedes the point on pensions and now thinks of conceding it on redundancy, so it will be a little difficult to deny it to

  265
  the sick. No rational person can go to someone who is sick and say, "You deserve less insurance money from the State than someone who is unemployed" when both the sick man and the unemployed man are young and vigorous and have families to support. One surely cannot claim that the sick should be treated worse than the redundant. If one does, one is in trouble.
  I am glad to see severance pay introduced by employers for those made redundant. But that is no adequate substitute for a State redundancy scheme which recognises the obligation to see that, where an employer is not so generous, his redundant workers will not suffer. The same principle applies in sickness and in old age.
  The Minister asked me to deal with non-transferability. I have been thinking about this for some time and I have brought some ideas with me. The question of transferability of pension rights is one of the most important for the good of the economy. It is not only a question of social justice but is absolutely vital to enabling people over middle age to be ambitious. A terrible fact about Britain today is that in the progressive firm—it is not such a firm's fault—if one is over 40 and has children one dare not move.
  We all know that one of the greatest obstacles to attracting scientists from industry to help the Government is the non-transferability of their pension rights. The greatest difficulty in the way of sensible circulation between the universities, Whitehall and industry is non-transferability of pensions. It is obviously sensible as well as just that in changing jobs we should carry our pension rights with us. [Hon. Members: "Hear, hear."] I am delighted that there appears to be such general agreement in the House.
  How do things work in the Treasury? I know the case of a scientist, an expert on pneumoconiosis, who got very interested in the problem of light-ray detection of dust particles. It was essential for him to go to the United States and he was offered a job as assistant professor at Rochester, New York State. He specifically said that he would wish to come back here after about five years. He said, "I want to come back but I might go to a university
  266
  before returning to Whitehall". The Ministry of Fuel and Power first said, "In that case you are out; no pension rights for you; you left voluntarily and you shall not have a pension." Whereupon his trade union took up the case and I have with me a fascinating correspondence between the Treasury official and the secretary of the union on the subject of what is public service. After some months of discussion the Treasury official conceded the point that where there is a real public interest it may be possible for someone who has been in the Civil Service to break his service and then have his years counted when he goes back. The letter reads:
  "…it must be shown that there is a real public interest—and this we interpret as meaning an interest to the public service—in allowing a civil servant to leave the Service to do that work. The fact that a particular line of research is likely to be of general public interest is not of itself a sufficient reason for this."
  The debate went on. I have a later letter which was written because the trade union secretary was pertinacious and received another reply, which is a classic. He had pointed out to the Treasury that if the Treasury wanted to drive scientists to living in America, this was what it ought to do to them—treat them in this way and rot encourage them to come back by giving them their pension rights. The Treasury reply was:
  "While it is certainly important that we should try to regain the services of scientists who may already have gone to America, we are equally anxious that British scientists—particularly those already in Government employment—should not be encouraged to go in the first place. An offer to reinstate a scientist's eligibility for civil service superannuation should he choose to return is just as likely to encourage existing staff to leave the Service as to tempt former staff to return. This is a state of affairs we do not feel able to encourage."
  The scientist had said that he wanted to go to America because that was the only place when: he could get the knowledge which was needed in Whitehall, but he was told that he might be encouraged to go to America and to stay there if this eligibility was given to him.
  I do not blame the Treasury civil servant, who was doing his duty, but I remind hon. Members that, strangely enough, the Treasury has power to allow such a man to take his pension rights with him but finds itself unable to accept

  267
  such a case because of the present attitude to transferability.
  Again, I do not want the Minister to tinker with this. I do not want him to say, "We will modify it a little for scientists." I want something much more drastic, something which we have put in our document. Perhaps the Minister will read and understand the passage which runs:
  "Steps will also be taken to ensure transferability in all private pension schemes."
  Is there doubt about that? If there is, I will spell it out. It means that we shall do two things. First, no pension scheme will be eligible for tax concessions unless its benefits are fully transferable. That is a very simple way to do it. Of course, if an employer chooses to sacrifice his tax concession, he can have any scheme he likes, but if he wants the Income Tax authorities to O.K. it he must write in full transferability of the employer's contribution and the employee's contribution. But to make it crystal clear I would go further and pass a law which would not permit any pension schemes which did not allow full transferability.
  Strangely enough, it is a delusion to believe that industry will oppose this proposal. We have already seen that N.E.D.C. has supported the idea. There is a very wide understanding throughout industry that one should not try to keep a grip on staff in a feudal relationship. A Government with the courage to legislate for transferability of pension rights, or to make non-transferability illegal, will have widespread support from many realistic employers' associations, as well as from the trade unions.
  Mr. Tiley: Transferability is very important. Would the hon. Gentleman include in his proposals the provision that after the policy is laid down the pension should be frozen until retirement age and not encashed at the moment of changing jobs, as is the case with most schemes now?
  Mr. Crossman: I agree that the question of the conditions in which people are allowed a lump sum out of a pension scheme is extremely important. Certain schemes allow it, and in private life insurance I do not see how that kind of thing could be prevented. But we are discussing not individual life in-
  268
  surance, but collective pension schemes, superannuation schemes, and I can see no difficulty about saying of such pension schemes that the pension is frozen and that there will be no lump sum. It will be deliberately arranged that when a man is in America or merely changing his job in the United Kingdom, he will go on earning pension rights as he moves from job to job, and that all the rights will be added up so that in the end he receives an amalgamated pension resulting from his circulation among those different jobs. We have put it rather briefly in this document, not because we do not think that the subject is important—it is extremely important—but to air it this afternoon in order to find out what the Government's reply can be.
  Sir William Robson Brown: I am most interested in all this and I support the hon. Member in general principle. I interrupt him with one question. Let us suppose that a man is 55 years of age and, under the hon. Member's scheme, wishes to transfer to another company. That company may have no pension scheme but may employ the man for the rest of his working life without continuing his pension payments. This could be very important, because a company could be robbed of a good man nearly all of whose pension contributions had been paid. The man could suddenly go to a competitor which did not have to continue the pension contributions. What has the hon. Gentleman to say about that?
  Mr. Crossman: I am fascinated to find that once again the Opposition is placed in the position of having to take the decisions and the responsibility. That is a question which the hon. Member for Esher (Sir W. Robson Brown) should have addressed to the Minister. The answer to it, if I have to give an answer, is that on the whole it is true that if a firm pays good pensions people will not leave it to go to another firm, unless there is a comparable pension scheme at the other firm. I see the difficulty that at the age of 60 an attempt to "steal" contributions might be made, but I can only say that I could not work out a scheme on my feet which would meet that. I am laying down the general principle of transferability and asking

  269
  that it should be made the law of the land.
  The Minister asked about contracting out. We have made it absolutely cleat that the contracting out which we discussed in Committee when the Government scheme was being put through the House has not worked out as badly as we predicted. We would make some minor changes, but. broadly speaking, conditions for contracting out—which are that the employer must give better than the Government scheme—are workable—administratively difficult, but workable. However, it ought to be clear that if instead of a deliberately bad scheme there is introduced a deliberately good scheme, employers will be faced with an entirely different problem.
  When we offer half pay on retirement to the average worker, to the worker at £17 a week, and 65 per cent. to the worker at £12 a week and 45 per cent. to the worker with £40 a week, we are offering a scale which the employer who wishes to contract out will find it difficult to match. The vast majority of schemes which are now valid for tax concessions would not be able to match this on retirement. There are, of course, municipal and Civil Service schemes which give more than half pay however the period of earnings is calculated. But there will be many employers who, faced by a really good graded pension scheme, really first-rate sickness benefit and unemployment benefit and old-age benefit, will not want to opt out.
  What happens then? Here I make a suggestion. At present, we think of pensions as being vertically divided. On one side are those people who have private pensions and who regard the National Insurance benefit as a mere addition, if they get it at all—it is not paid in the Civil Service where the National Insurance pension is amalgamated into the total pension. On the other side of the division is the National Insurance pensioner. If a first-rate National Insurance scheme were introduced, the tendency would be to change the shape of the division. Most employers would accept that it was good value for money to join the Government's scheme.
  The better employer would add his contribution to the sum paid under the Government scheme, so that whereas the
  270
  Minister wants to build the foundation of the house and leave the employer to build the rest of it, I should like to build the foundation and the ground floor and leave it to the employer to build the first floor. That is the real difference. Under us any good employer will say, "All right The State has given half pay on retirement so I shall put it up to two-thirds for my staff". A whole mass of voluntary superannuation schemes will be horizontally super imposed on a good State scheme, and not stand vertically by its side.
  I am not saying that we shall compel anybody to join the scheme, because every employer will have the right to contract out, providing he guarantees benefits as good as ours. I have no doubt that during the first ten years a small but important segment—mostly those in the upper income groups—will contract out of our scheme because their pension rights will be better than ours. For at least ten to fifteen years employers like LCI. will pay better pensions than the State can provide, even in a good State graded scheme, and will want to contract their workers out and not pay for both schemes. The Minister asked me how we saw this problem, not in the detail of administration, but in the broad principle, and how we should introduce it, and I have tried to answer him.
  My final point is, I think, in a sense the most important. We have talked about the future. The immediate question is what we can do now for old-age pensioners, for those who are sick, and for those who are redundant? For the sick and the redundant we could pass an Act which would automatically give them half-pay. We could change the rate of benefit and the rate of contribution overnight, and anybody who was redundant would be able to draw the new rates of benefit, and for the rest of his working life he would pay for the higher benefits he received while sick or redundant.
  The people to whom we cannot do justice arc the present old-age pensioners. We cannot introduce half-pay for them, because we cannot give them half of nothing. These old people present a major problem of social injustice. We have put forward a clear scheme in our New Frontiers for Social Security. As a co-author, I think that this book explains the position very clearly, but if

  271
  the Minister does not understand it, I shall explain it to him again. [Hon. Members: "No."] If hon. Gentlemen opposite know of this scheme, and appreciate that it is clearly set out in that booklet, that is fine by me. We are going to guarantee that no widow's income, or the income of anybody who has retired, shall fall below a certain level. [Hon. Members: "What level?"] If hon. Gentlemen opposite tell me what the level of National Assistance will be at the time of the next General Election, I shall tell them what the income guarantee will be. It is not possible to tell one without the other. We must first know the rate of National Assistance before we can work out the other, because these are related.
  The income guarantee is related to three factors. It says that a person shall get the full National Assistance rate and something extra for rent. We know that in National Assistance the amount for rent varies between £2 and 2s. If we have an income guarantee, there will be an allowance for rent of between £1 and £1 5s. Then there will be added some 15 per cent.
  The aim of the scheme is to ensure that year by year more and more people are taken off National Assistance. I know that some hon. Gentlemen opposite think that there is no difference between the two schemes. They say that it does not matter that a person has to apply for National Assistance. I assure them that it matters a great deal to the people whom I know in Coventry. We attach the greatest importance to working out a scheme under which the guaranteed supplement to the flat-rate old-age pensions is paid as of right through the Post Office and not after a request to the National Assistance Board.
  Mrs. Slater: And a means test.
  Mr. Crossman: Yes, of course! Hon. Gentlemen opposite may say that if the money is paid through the Post Office it will still be a means test, but in my experience filling in an Income Tax form is not identical with going to the National Assistance Board and having to submit to an investigation by it.
  There is an essential difference between an income guarantee and a
  272
  National Assistance supplementation. If the Government think that there is no difference between the two, I advise them to adopt my proposal. If the difference is a mere formality, for heaven's sake let us accept it! If we do, I guarantee that half a million more people will receive the supplementation. Our calculations show that at least half a million people deny themselves the National Assistance to which they are entitled because they will not ask for it, and because they will not accept the means test.
  Under our scheme, by filling in an Income Tax form they will automatically have the right to this pension. There is a great difference between everybody having the duty to fill in a form once a year, and having to make the terrible decision to go to the National Assistance Board. That is why they spend their savings, and why, month after month, they get rid of their capital rather than face an examination by the Board.
  If hon. Gentlemen opposite say that people are silly to do that, they must remember that it is not possible to eradicate the past. The past is in the bones of these old people. They hated having to go to the National Assistance Board. We must eradicate that past once and for all by providing an income guarantee. By doing so, we reckon that within six years 2 million people at present receiving supplementation will no longer require it, and the Board will be left where it belongs, as a net to pick up those who, unfortunately, are not helped by the social system.
  It is not possible to give the figures for a flat-rate pension because we do not know the level of national earnings and the cost of living. But we believe that the level of the flat-rate pension should be kept in a permanent relation to national male earnings. The Minister gave some interesting figures and claimed, I think rightly, that during the last twelve years the level of the pension had risen faster than the level of national earnings. That is fine, but what we have to do is to get the pension up to a certain proportion of national earnings, and keep it there by annual adjustments. What the Minister did not say was that in order to get the pension up by 125 per cent. it was necessary to bring in four Acts of Parliament.

  273
  Pressure had to be brought on four occasions. Four times we had to go through the dreary process of fighting for the increase. Four times we had the process of lobbying, of "pensioneering" and of vote-catching. These things should be eliminated from our consideration of old-age pensions. Our aim is to eliminate the need to debate this subject in Parliament and to say that if national earnings rise by one-fifteenth in a year, the pension will automatically rise by that amount.
  Once we fix the slice of the National income we want to give the pensioner we must see that it comes to him every year without another Bill. The humiliation of. the Bill is almost as bad as that of the means test. If workers had to have their wages fixed by Act of Parliament—which always come into force nine months afterwards—they would be striking the whole time. It is only the pensioners to whom we can do this. We can eliminate this difficulty by a Bill which relates pensions to average male earnings and keeps them steady by annual adjustments.
  I have tried to explain not the whole of our scheme but our point of view on the most difficult parts of it. I am delighted that we should have to take the lead and do all the constructive thinking. I am delighted to have the Government following along behind us, tentatively seeing how many votes they can steal by giving a little on the earnings rule, here and there. But I know that they will not carry out this reform we shall have to have a new Government to do the job which we know must be done.
  6.11 p.m.
  Sir John Vaughan-Morgan: The hon. Member for Coventry, East (Mr. Grossman) said that there was a certain sameness about these debates. That is true. Last year he followed me, and this year I follow him. Even the theme of the debate does not vary very much. But there are one or two changes in personalities. We are sorry that the hon. Member for Sowerby (Mr. Houghton) is not speaking for the party opposite. He always brings great humour even to his indignation. But there is a sameness about the debate, and the hon. Member will forgive me if
  274
  I do not follow him on all that he says—much of which I should like to refute.
  He was a little unfair when he said that he could not give the figures until he had the figures of National Assistance benefit at the time of the General Election. He might have given us the figures on the basis of the present National Assistance benefit.
  Mr. Cross man: I could.
  Sir J. Vaughan-Morgan: The hon. Member says that he could. I shall not give way, however, out of sheer interest for all my colleagues who wish to speak, "following a rather voluble example. Hut it is a real" give-away".
  He says that the party opposite has the bright ideas, but that is not true. Many ideas have been ventilated from these benches. But at least we put them forward tentatively, until we have the figures, and the figures can be supplied only by the Minister. Our duty is not only to put forward alternative policies; it is to offer ideas to our Front Bench. Sometimes hey are eventually accepted, when they become feasible.
  I agree with the hon. Member for Coventry, East in principle on the question of the transferability of pensions. As an example of ideas coming forward from this side of the House, I can say that there was a pamphlet published by the hon. Member for Stratford-on-Avon (Mr. Maude) and myself nearly twelve years ago on this very point. But he is wrong in saying that every pension should be 100 per cent. transferable. He said that it was tragic how many men of middle age were unable to move from their jobs. I agree with him up to a point, but he did not seem to realise that his argument back-fired on the subject of scientists going to America. Here the non-transferability of a pension is a measure of disincentive. One of the motives of employers in introducing these pension schemes—my firm introduced its first pension scheme 85 years ago, which is not bad going—is to try to secure the long-term employment of their workers, It follows that the longer workers are employed the higher should be their benefit. This must be a disincentive to move.
  I do not want to go into the other points raised by the hon. Member, out of courtesy to the other hon. Members

  275
  who wish to speak. There is one respect in which this debate is not quite the same as last year. I must point this out because I drew attention to it last year. Last year the Opposition Motion referred to old-age pensioners. No doubt because it has fallen to that legal eagle, the hon. and learned Member for Kettering (Mr. Mitchison), to move the Motion this year, it is correct at least in referring to retirement pensioners. There is also a slight variation of wording in the Motion, which now refers to "wage related benefits", whereas last year it merely called for a comprehensive increase.
  There is a further improvement this year in the Government Amendment, which talks about having regard
  "to those groups whose need is greatest".
  I look upon that as a concession to those back benchers on this side of the House who have consistently been pressing for this, and who produced an absolutely categorical demand for it at the party conference at Blackpool.
  The proposals which the Prime Minister made today are thoroughly welcome to all of us. Most important is the fact that there is a further overall increase in the disregard before the earnings rule operates. The Chief Secretary will be able to refresh his memory that the idea was one which also came from these back benches. We said that there should be some relaxation of the earnings rule. But I still feel that there is not a full appreciation of the view which is held on these benches that there should not generally be any blanket increases but that there should be even greater selectivity than there has been.
  Above all, I reiterate the plea that I put forward in an earlier debate for a complete review of the whole of our social security system. I do not mean that in any derogation of what the hon. Member for Coventry, East has said, or as any discourtesy to him. He has been the author of so many schemes. He was putting forward an approach which he said would remove pensions altogether from this question. I would work for that, too, but it cannot be done by the party machine. We must have a new national look at the whole question.
  Mr. Crossman: Hear, hear.
  Sir J. Vaugban-Morgan: Yes, but it cannot be done from Transport House or from the Conservative Central Office. It cannot even be done from the Ministry of Pensions. We need something better than Beveridge. It is essential, but it will take time.
  Mr. Crossman: You have had twelve years.
  Sir J. Vaughan-Morgan: Twelve years? Good Lord—twelve years ago we were within a comparatively few years of Beveridge. Only now do we see that the present system—although not bad; it has worked very well considering all the difficulties—will not suffice, and that we need a long-term view in order to chart ahead for the next thirty years.
  I hesitate to mention the Royal Commission on the Poor Law, which is what the Liberal Party was lucky enough to inherit in 1906 and on which it based its plans, just as the Labour Party inherited Beveridge and based its plans on that. We shall have the Royal Commission reporting in a year or two, and we shall be able to implement its plans in due course. But that is no excuse for inaction at present. Any drastic reform of social security carries within itself one further important difficulty. It creates further anomalies if the major principles are changed. We had the anomalies arising from the pre-Beveridge era, and we shall have the same thing again if we make a major change. Meanwhile, we must continue to try to amend the present system as we think fit.
  There are three features which still stick out a mile. The first is the earnings rule, which has been improved yet further by the changes announced today. I would not advocate total relaxation but, as a corollary to the relaxation of the earnings rule, I suggest to my right hon. Friend that the increments need looking at again. If we relax the earnings rule we make greater opportunities for those who stay on at work and who are enjoying pensions, and, if the principle is the same thing, we should at once increase the increment so as to increase the incentives to those who stay on and defer their pensions.
  There is another matter where the need for reform stands out a mile. I refer to the short-term sickness benefit.

  277
  In the last debate I advocated that this should be made an employer's liability and I wish to repeat that, although I think that last time I was wrong in the length of time I then specified. I think that this should be made an employer's liability for, say, a couple of weeks. When I made that point—the hon. Member for Coventry, East shakes his head?
  Mr. Crossman: No.
  Sir J. Vaughan-Morgan: The last time I made that suggestion the hon. Gentleman said I had forgotten that employers would never employ a sick man. I have looked up his speech.
  Mr. Crossman: I said that we should not need it for a long period but there was something to be said for a short period like ten days or a fortnight. I think that the right hon. Gentleman was recommending a period of 13 or 14 weeks.
  Sir J. Vaughan-Morgan: I am sorry. There was a misunderstanding on my part. The last time we debated this I did say 13 weeks and I wish to make that period much shorter, although not necessarily for the same reasons as the hon. Member for Coventry, East.
  I think that the hon. Member neglects the fact that many people are now subject to a medical examination in most employments and that this would cover the kind of sickness which might take up to a couple of months. At least we are agreed on that now, and I hope that my right hon. Friend will pursue the matter. If nearly 50 percent. of the people in the country are covered by occupational health services and sickness benefit schemes it would be right to have a statutory extension making it an obligation on the employer. Incidentally, it would eliminate an enormous amount of administrative work.
  My last point relates to a supplementary benefit for the very old, which is something that has been advocated by hon. Members from these benches. I hope my right hon. Friend will look at that matter again. I accept that if we increase what would generally be an old-age pension, say, at 75, or at 70, for the old, we should be distributing some benefits to those who were not necessarily in need of them. But it would be
  278
  a lower percentage than if we gave a blanket increase again at a lower age. My hon. Friend the Parliamentary Secretary dealt with the suggestion when I made it last year and said that it was a distasteful job to select which misfortune was worse under the scheme. I agree. But of course there is already a marked degree of selectivity under the scheme and the obvious case is that of widowed mothers whose position we have today further improved.
  Any variation of any sort in the earning rules, involves further selectivity. We reduce it for widowed mothers and equally it is for those over 70 in the case of men, or 65, who are still at work. In this connection I interviewed a constituent last week. He is over 70 and has earned the full increment and is still at work. He was complaining of the disincentive effect of Income Tax, which was rather an eye-opener.
  I am asking only for an extension of selectivity. I have found no arguments which are convincing against taking a further section out of the general scheme, that is to say, the very old. We may disregard the fact that it would be an injustice to other classes because this is a class in favour of whom we could discriminate deliberately. That would certainly be better than the rather nebulous proposals of the party opposite about an income guarantee, which, however they may say it, does involve—I will not say a means test, that is an anathema. But a certain distinction does exist between those who pay Income Tax—like my constituent—and those who do not. I hope that this sort of suggestion will be looked upon with favour by my right hon. Friend.
  I end as I began. We are all, as it were, grouping and arguing round minor facets of our social security scheme. I hope that, sooner or later, we shall have a completely new review of the whole problem.
  6.25 p.m.
  Mr. Harold Finch: I am glad that the Minister has decided that war widows whose husbands, before their death, suffered from serious incapacities are to get an increase by way of a 13 weeks' allowance. I understand that this will apply in the case of those men who were in receipt of constant

  279
  attendance allowance or the unemployability allowance. On their death their widow will receive an amount depending largely on the allowances previously paid. That is a very humane act on the part of the Minister.
  It is possible to give examples. There is the war pensioner ex-Service man who may have been in receipt of £12 or £14 a week. I refer to the seriously incapacitated and bedridden cases where constant attendance allowance, disablement benefit and other allowances may well amount to £12 or more. According to the statement by the Minister, the widow will now receive about £10 a week for the first 13 weeks.
  It would have been equally humane on the part of the Minister had he applied the same principle to the widows of men employed in industry, those who worked in factories and mines and workshops and who became incapacitated and bedridden. They include spinal cases and paraplegics and others who will never work again and whose position is precisely the same as that of the war pensioners. I could cite case after case of miners who have been injured and totally disabled and who have been in receipt of £12 a week, representing the combined disability and constant attendance allowances and other allowances. At their death the income for the family drops to £4 15s. a week and eventually to 75s. That is a serious drop in income, and the effect is as serious for the widows of these men as for the widows of war pensioners.
  This involves the whole question of pensions. A widow whose husband died from natural causes receives £3 7s. 6d. a week. Old-age pensioners get £3 7s. 6d. and a married couple receive £5 9s. As was pointed out by my hon. and learned Friend the Member for Kettering (Mr. Mitchison) £5 9s. represents poverty for old-age pensioners. All the arguments we may deploy cannot belie the fact that £5 9s. is poverty for old-age pensioners. I should have thought that the Minister might have indicated that he was prepared to increase this amount for those in retirement and for widows, especially for "industrial widows" as I term them. In my opinion, these benefits are much too low to allow for proper subsistence let alone a decent standard of living.
  280
  I do not wish to repeat the arguments used about pensions, but to return to the main point and indicate the disparity between those injured in industry and those who were injured during their war service. Over the years this aspect of the Industrial Injuries Scheme has been lost sight of. The Government have always said, and on this I do not disagree, that war pensioners should have preference and priority in social services. One accepts that if there is not an unlimited supply of benefits and services, but it is pertinent to remember that the war has been over now for 18 years. Priority does not mean that the industrially injured should never be considered, but that is what is happening today. To our way of thinking priority means that if there is a queue for payments those with the most urgent need should receive first attention. I am dealing with the man injured in industry, in the factories, mines and workshops, from whose industrial activity the nation has benefited.
  I point out certain marked differences between those injured as a result of war and those injured in industry. There is a constant attendance allowance. In 1961 the Minister said that a man who was 80 per cent. disabled by war service but 100 per cent. disabled from other causes would have constant attendance allowance, but a man disabled industrially has to be 100 per cent. disabled from his accident to gain the allowance. It has been of great help to seriously incapacitated war pensioners, but there are scores of injured men who are 80 per cent. disabled, and many of them can never work again. Owing to their age, they are actually incapacitated 100 per cent., the same as the ex-Service men, but there is no constant attendance allowance for them.
  I do not know how the right hon. Gentleman can justify this situation. There the man who has been injured in the war and the miner who may be suffering from pneumoconiosis, or may have a spinal injury and be bedridden. They are both the same kind of case; why is there the difference in treatment? I make the allowance that in the early days after the war some priority should be granted to ex-Service men, but 18 years after the war there is this marked

  281
  difference between those industrially injured and those injured on war service.
  Unemployability allowance is 74s. a week for a war pensioner as against 67s. 6d. for an industrially injured man. Both have been officially described as unable to work for the rest of their lives. The comforts allowance is 10s. or 20s. for the most seriously disabled and was introduced in 1951. It is greatly appreciated by war pensioners, but it does not apply to the industrially injured. There is an age allowance for war pensioners of 5s. to 15s. a week for those over 65 who are 40 per cent, war disabled. That was introduced because often the effects of old age on an injured man make a great deal of difference to his state of incapacity. This allowance applies to war disabled, but not to the industrially injured.
  There is a clothing allowance which was introduced in 1946 for ex-Service disabled pensioners who have to wear artificial limbs but there are scores—hundreds—of injured men from the mining industry who have to wear artificial limbs. The ex-Service man gets an extra allowance for this, but not the industrially injured man. Then there is the occupational allowance of 20s. a week for war pensioners. That is to provide for the fact that when those men are normally employed their earnings are low. There are industrially injured who are in exactly the same position.
  Then there are the injured miners, paraplegics, who can get about only with a one-seater tricycle. Motor cars are provided if they are war pensioners. They can go out with their wives in the summer and make the best of their unhappy circumstances. But there are hundreds of paraplegic workers who have been in mining and other industries and cannot now work, who also would like to take out their wives in the summer. We have brought to the notice of the Government case after case in which one-seater tricycles have broken down, and men have had to wait for hours on lonely roads for assistance to come to them. Repeated representations have been made to the Minister of Health, but nothing has been done about this.
  I appeal to the right hon. Gentleman seriously to consider the man who is unable to get about except in the com-
  282
  pany of hi; wife or a friend with a motor car. We have put several cases to the Minister in which these tricycles have broken down on a lonely stretch of road and the paraplegic has had to wait for hours before he could obtain assistance. The Coal Industry Social Welfare Organisation has met the Minister on this. It is prepared to come part way to meet the cost because there are so many of these cases in the industry. The organisation is prepared to come half way so that these unfortunate men may be able to have motor cars the same as ex-Service men who are similarly incapacitated.
  Up to now excuses have been made. Some say that it is a matter for the Ministry of Health, but the Ministry of Health says that it has no powers to deal with the matter. I draw attention to Section 75 of the Industrial Injuries Act, which makes provision for appliances of this kind. I appeal to the Minister seriously to consider the granting of cars for these men. There are not so many of them in total. Surely the Government are in a position to allow the cost to be paid for these paraplegics who otherwise have to travel by one-seater tricycles.
  I refer to another matter which I have raised on many occasions. That is the question of men suffering from pneumoconiosis who go before medical boards. I challenge the Government on this. On the highest medical authority it is impossible to say the extent to which a men is suffering from bronchitis, pneumoconiosis or emphysema. In these cases a medical board can arrive at its decision only by guess work. When a man is suffering from pneumoconiosis and it is agreed that to some extent it is accompanied by bronchitis or emphysema, he should be given the benefit of the doubt.
  Medical opinion differs following the death of a miner. There are many cases in which a pathologist disagrees with the findings of the medical board. Where experienced pathologists come to a decision that in their view a man has died from pneumoconiosis and they differ from the medical board, there should be means whereby there can be an appeal. I hope that the Minister will seriously consider this question. He comes to his present office after having

  283
  been Minister of Power. He has had considerable experience of the mining industry and no doubt he has met men suffering from pneumoconiosis. No doubt he has been down the pits and met officials of the National Union of Mineworkers and of the National Coal Board. I am sure that he comes to this office with a fair knowledge of industrial diseases. He must know of the serious and terrible diseases suffered by so many miners and of the grave dissatisfaction which still exists at some of the decisions of medical boards. I hope that as a result of his experience as Minister of Fuel and Power he will give consideration to the medical evidence submitted about pneumoconiosis, particularly when it is accompanied by bronchitis and emphysema.
  Mrs. Slater: My hon. Friend would surely agree that this applies not only to miners but to potters and others? Does he agree that it would be a good idea to lay down a condition that, if someone is suffering from chest trouble after he has worked in an industry for 10 years, he should be given the benefit of the doubt from the point of view of industrial injury benefit?
  Mr. Finch: This issue has been raised before. I agree with my hon. Friend. If a man has worked in an industry for 10 years and has a disease, he should be given the benefit of the doubt. For the moment I ask the right hon. Gentleman, in his early stages in this important Ministry, to consider the matter thoroughly and examine the evidence of medical men, who are very definite in their view that on the subject of pneumoconiosis injustices are being done to many men and widows where there should have been a certification. If we press the Government hard enough, we shall get more increased benefits before the General Election. We shall welcome them. All we need to do is press a little harder. We on this side will be entirely satisfied if we can gain security for the mass of men and women who are unable to help themselves.
  6.42 p.m.
  Dame Edith Pitt: This debate on social security has become a hardy annual, but this is the first time ever that I recollect
  284
  anyone from the Opposition benches saying, as the hon. and learned Member for Kettering (Mr. Mitchison) did today, that the real benefit of the flat rate had risen. I am grateful for that admission, because in general the Opposition have a convenient blind eye which they turn on the Conservative Government's record in social security.
  I shall not try to follow the hon. Member for Bedwellty (Mr. Finch) into all the complications of the industrial injury side of the work, because that would take far too long. The hon. Gentleman said that £5 9s. is poverty and he asked how anyone could live on it. The answer is that no one has to live on £5 9s. If that is all that a married couple in retirement have, they are eligible for National Assistance. In any event, does not the basic pension of £5 9s. contrast extremely favourably with the 42s. available in the day when the Labour Party was in power? [Interruption.] These are the facts. We are entitled to remind hon. Members of the record, because it is on the record that both Parties will be judged.
  Mrs. Slater: Does the hon. Lady recollect that she herself said from the Front Bench when she was Parliamentary Secretary that she considered that 40s. was not a bad pension, that her father had lived on it, and that she did not see why we should not be able to live on it? The hon. Lady made that remark in a debate in which we tried to raise the old-age pension.
  Dame Edith Pitt: The hon. Lady must not misquote me. I compared 40s.with the expectation which people like my father had of only a 10s. pension in the old days. He, in turn, compared it with the average wages in pre-war years.
  I think that the Government have cause for sober satisfaction in the improvement they have brought about in the economy which has made possible in the past 12 years five increases in National Insurance benefits and eight increases in National Assistance. The benefits have been more than doubled in terms of cash, or three times in terms of prices. The hon. and learned Member for Kettering suggested that benefits had slipped back compared with earnings. Unless my simple arithmetic is very much at fault, the present rate of

  285
  benefit for a single person of £3 7s. 6d. compares more favourably with the average earnings of about £16 than did 26s. in the days of the Opposition with an average pay packet of £8 a week. The hon. and learned Gentleman's point is therefore disproved. I believe it to be unarguable that retirement pensioners and others who receive National Insurance benefit are better off today after 12 years of Conservative administration. We can claim with truth that pensioners have shared in the good things which a steadily expanding economy makes possible. The pensioners themselves know this and acknowledge it. I believe, therefore, that they are much more likely to put their confidence in the Tory Party, because they can judge us on the record, than they are in Opposition promises.
  The Opposition Motion contains the word "hardships". I wonder how they define "hardship", particularly amongst pensioners. There is one group I can quote where I know of cases of hardship, but these people are entirely outside the State scheme. These are the very old people, people who were precluded before 1948 from contributing to the previous National Insurance scheme, and who because of their age could not come into the present comprehensive scheme. They are diminishing in number, but at the same time are seeing the precious assets which they saved in years gone by, hoping to be comfortable in their old age, also diminishing.
  I am very sorry for these people. I realise that there is practically no way of bringing them into insurance so long after the event. [Hon. Members: "Why not?"] I hope that we shall continue to make National Assistance more generous and, in particular, to keep in mind the disregards of capital under National Assistance, because this system causes hardship in some instances. I know one elderly lady who is left with £1,000 capital. She is terribly reluctant to spend it, but it brings her in only 10s. a week. But for the help of the family she could not exist. This is where I wish the Welfare State were able to extend the security that we give.
  I must make the point that not all the people in the group of whom I am speaking—those who are outside comprehensive insurance—are in this pre-
  286
  dicament of facing hardship. Some of them, probably because their investments have prospered, are still in a comfortable position. There are other ways in which there can be hardship. These have not been even touched on yet. Loneliness can mean hardship, particularly in old age. That is why I attach importance to the progress the Government have made in other social services. I believe that the emphasis on special lousing and the encouragement that has been given to local authorities 10 step up the rate of building of one-bedroomed houses and flats do much to help retirement pensioners, because it enables them to live in a small place where they can keep their independence and where they can manage.
  The increase in the number of home nurses and home helps has the same purpose. The development of the meals on wheels service has been a boon to old people. The extension of the chiropody service, which we have been able to introduce, literally keeps people on their feet. The elderly do not want to go into Part III accommodation or occupy beds for chronic geriatrics. They want their own homes with their own things around them. The more we can develop these ancillary social services the better we will deal with the hardship of the aged.
  It is equally important to help them to maintain their interests. By this I do not mean that they should be enabled to continue digging the garden, good though that is, or have a hobby which occupies their hands. It is essential, if old age is to be enjoyed, that the mind should be kept alert. This is a job for both the Government and the voluntary services.
  I return to the question of the elderly who live on State pensions, supplemented by National Assistance in some cases. I make the same point on this as I did about the smaller group of people who have no State pension. They are not all like. Thousands of people are drawing the State retirement pension who have other resources and who live in the comfortable old-age which the hon. and learned Member for Kettering desires for them.
  For those who must be content with the basic, I agree that it does not permit of any frills or luxuries. Although food

  287
  prices have remained fairly stable, people need knowledge, time and energy to shop for bargains. It is often the old who do not have these qualities. In fact, some of them are not able to leave their homes even to do their shopping. Electricity has goneup in price this year and the word the pensioners use to me to describe the price of coal is "horrible". They need food, warmth and light all the time if they are to live in even reasonable comfort.
  It is natural pensioners should wish to improve their position, for they see all around them people doing exactly that. It is along these lines that I receive complaints, not so much from the pensioners themselves as from people who are working; people who are doing well and who feel that more should be done for the aged. Despite this, they never begin to consider how all this is to be paid for.
  I regret that the hon. Member for Coventry, East (Mr. Crossman) is not in his place. Some of the workmen I know in Birmingham are in occupational schemes. They have expressed concern about the Opposition's proposals for minimum incomes and wage-related benefits. They are wondering from where the money is to come. They fear that if by misfortune we have a Socialist Government who try to introduce such a scheme, they may bepenalised. These people have by choice decided that the right thing for them is to contribute to their firm's pension scheme and they fear that if the Opposition's proposals are implemented they will have to find a great deal more money to build up the airy-fairy schemes of the party opposite.
  The Opposition's proposals are asking for a blank cheque. The hon. Member for Coventry, East queried the assertion that workmen were free to join occupational schemes. He said that the vast majority of these schemes were a condition of service. I agree, but I do not think that the hon. Member for Coventry, East knows much about these schemes. I have not only been a member of one but I helped to introduce one in a factory with about 1,000 workpeople. To begin with we had to persuade and sell the idea to them. They were rather hesitant about what they would get for their money. In the end we got 100 per cent. accept-
  288
  ance of the scheme and now it is a condition of service. It is valued by those who contribute to it, for it has been specially arranged to suit them in their particular trade. They feel worried about the proposals of the party opposite, and I warn Socialist hon. Members that if they do anything to prejudice the rights of those who have expectations as a result of joining occupational schemes they will find themselves extremely unpopular in the country.
  The hon. Member for Coventry, East said that contracting out would be possible. He also made great play with all the work that had been involved in the calculations of contracting out. He said later that employers would find it difficult to match the provisions of the Opposition's scheme. I wonder if he truly believes in contracting out or if he really thinks in his heart that if the sort of device the Opposition propose was introduced—the fourth edition of such proposals, if I remember aright—a large number of occupational schemes would come to an end. If this did happen the party opposite would be making a grave mistake.
  In any case, I doubt whether the finances of their proposals would stand investigation. The hon. Member for Coventry, East talked about the State providing the ground floor of the house and the employer topping it up with another storey. While he was speaking I had the feeling that he was building an edifice of candy floss, particularly since he did not want to commit himself to figures. Had he revealed the figures the public would be sharply disillusioned at the promise of half pay on retirement.
  If employers should be called on to pay more—and I fear that the hon. Member for Coventry, East made suggestions which would have inflationary effects—and if contributions are to be heavily increased, will not the increases be added to the price of goods, the price of the exports by which we live? I fear for the strength of the economy and the maintenance of our social services.
  Before the party opposite go to the country, they will need to place the £ s. d. of their scheme before the public. They will need to be more certain than they have been on previous occasions that their figures are accurate. I recall

  289
  that when the first edition of the Socialist superannuation plan came out it had to be withdrawn in a hurry. I cannot remember all the details, but I do recall one sum being put on the income side when it should have been on the debit side. That first edition contained an element of contributions from Northern Ireland which could not possibly have been included. I cannot remember all the details, but I am sure that when the Minister replies to the debate tonight his memory will be better than mine and he will be able to stress once more that, if the scheme of the party opposite is to be considered objectively, correct figures must be produced.
  I agree that the time has come for reshaping our social security system generally. I said that a year ago. However, it must be properly worked out and be workable. We are up against an increasing difficulty each time we improve the flat-rate benefit. We have been told that there are nearly 6 million retirement pensioners in Britain. If we are to spread the available money across the board, then obviously there are limitations not only on what can be paid out but on the contributions we can take from the lowest-paid workers. This means that in future we should concentrate on selective and long-term benefits. I was glad that the Minister spoke this afternoon of the consultations he is having with representatives of industry on short-term benefits. I made this point last year; that if acceptance of responsibility for short-term sickness and unemployment benefit could be that of the employers, we could do more to develop the long-term benefits in the selective areas of need. I was glad to note in the Amendment that the Government are continuing their examination of the possibility of further developments related to earnings. However, anything done in this direction must be fair to all contributors.
  I am delighted with the announcement of help for widowed mothers. I have always felt that the problems of this section of the community—problems peculiar to widowed mothers—need special consideration, because a widowed mother finds herself both the head of her family and often the breadwinner. A whole range of social problems arise
  290
  as a result of her widowhood and we should help her as much as possible. Her problems have been enhanced in recent years by the tremendous increase in the standards of other sections of the community. She can make only slow progress. There is nothing for her in the Insurance Scheme when one considers the lost potential of a man who would no doubt be improving his earning capacity as the years go by. Whatever her income before, the widowed mother is shown up more sharply against the rising prosperity of the country than any other group of people.
  I am glad to recall that in years gone by we have done something to assist her. It is almost ludicrous to think that in 1951 her only benefit for her children, apart from any personal income she might have had, vas 7s. 6d. per week for her first child. She got nothing for her other children and until today the allowance has been 30 s. for the first child and 22s. for the remainder. I was delighted to hear the Prime Minister's announcement that this is to be raised to 37s. 6d. for each child. This is the best way of helping widowed mothers, irrespective of their earnings. I am glad that this amount will continue to be paid until the child's nineteenth birthday if full-time education is being taken.
  We have been whittling away at the earnings rue for some time. I have a good deal of sympathy with those who think that it should be completely removed for widowed mothers, although I realise the practical difficulties of doing this, for once one conceded it for one section of the community there would be demands from others, retirement pensioners for example. Nevertheless, the higher we take the amount earned before deduction—and it is now suggested that it should be £7, so that, in terms of gross earnings, I suppose that it will be about £9—the more we will benefit a large number of widowed mothers.
  For what has been announced today and the continued improvements for widowed mothers—along with the modest improvement for retirement pensioners in connection with their earnings rule—I am grateful to the Government and certain that, with the record we have behind us in matters of social security, along with the practical plans we will advance when present considerations are completed, we

  291
  are entitled to ask for, and I have no doubt that we shall receive, a very good vote of confidence from the recipients in the country.
  7.4 p.m.
  Mr. John McKay: I congratulate the hon. Lady the Member for Birmingham, Edgbaston (Dame Edith Pitt) on her speech. She is no longer in office but she still shows the great ability she has on the subject of pensions and matters connected with National Insurance.
  The plight of the aged presents us with a challenging problem and we all wish to do everything possible to solve it. A different attitude of mind is necessary if this problem is to be overcome; and the Labour Party is prepared to overcome it. We intend to increase contributions on a graded scale and by so doing, improve the generalsituation of pensioners. There is no doubt that some improvement is needed.
  Where exactly is the weakness? What causes lack of finance in National Insurance? I believe that most ordinary people have good will towards those in the community who are in difficult circumstances, and are ready to do a little more for them if there should be the necessity—and, apparently, we have the necessity today. There is no doubt that most people would like to see the poorest in the community made better off. The country is doing comparatively well, so how is it that we have so many people at the very bottom of our economic life, and why do we find difficulty in knowing what to do about it, and how to help those people?
  One thing that strikes one is that employers in Europe are doing vastly more for social security than are British employers. It may be that we do not feel so much about it; that we are not in that section of the community that feels this economic pressure and therefore do not allow these matters to weigh very heavily on us, but there is no doubt, looking at the various tables supplied, that employers in Europe are contributing to social security three or four times as much, on the average, as are our employers.
  Realising that, we ask at once, "Why cannot we do better, when others operat-
  292
  ing under the same competitive system can do so much?" This is a matter of feeling. It is a question of whether the individual will be bothered to help his fellow countrymen. I do not worry so much about the number of unemployed, sick, and the rest, but I want to show, from the Monthly Digest, the number of people who, though getting their benefits, yet have to reveal all their income and the little bits of property they may have in order to get National Assistance.
  There are 1,381,000 sick, injured, unemployed and retired people, and widows, who are getting National Assistance, and if we double that figure we include those of some independence but relying on National Assistance. When the ordinary man realises that, in our present economic condition, so many people in the insured category have to apply for National Assistance, it strikes him that it is time that something was done.
  We have carried on like this for many years. I admit that in 1948 there was only 2s. difference between the married couple on National Assistance and the married couple under National Insurance, but that was apart from rent, of course. As rent has always been a big item, there has always been a biggish difference. The point is that the difference exists. The actual need is well known and acknowledged, and there is no doubt that most people recognise that despite what may have been done in the past or the good that may come in the future, there is a great need for a strong move by the Government to deal with the present situation.
  The man who leaves his job without proper cause or notice has his unemployment benefit stopped for six weeks, and there is no doubt some reason in that. On the other hand, there are about 30,000 boys aged 15 or 15½ years who are wandering about unemployed and who get absolutely nothing unless—and I emphasise this to the Minister, because I know that he is a good chap—their fathers are on National Assistance. A man who is working can get nothing on account of his unemployed son. Further, if the father is unemployed or sick and the boy is at school, the father gets about 20s. for him, but when the boy leaves school he himself gets nothing and the father loses that 20s.

  293
  It is all very well to say that it is a boy's own fault, but we must remember that though the hundreds of men who leave their work without giving proper notice may be penalised, they are not penalised for ever. As I had said, they lose their unemployment benefit for six weeks only. It is not sufficient to say of these youngsters that they can go back to school. Their parents want them to be earning, and so do they, but they cannot find the work. The only boy for whom something is allowed is the son of a man who is on National Assistance—on the lowest scale of all.
  But is the boy who remains at school until he is 16—does as the educational authorities want him to do—thrown on the scrapheap? Is he ignored by our welfare society? No—he gets 37s. a week in National Assistance in his own right. He is not an outcast from society until he gets work. He has a means of living, because he is 16 but out of the labour market. Why should we allow these 30,000 youngsters—probably 60,000—to leave school and then treat them so differently from the way we treat the youngsters who are at school at 16? I agree that it is, on the whole, far better for boys to continue at school until they are 16 years of age, but that is not the present position. It would be far better to decide that either these boys must go back to school or that they must be provided for so that they are not dependent upon their parents.
  I should like to draw attention to an attitude on the part of National Assistance officials which is prevalent at least in the north of England. Men who have been out of work for four or six months and who during that time have been receiving National Assistance often find themselves having to start work in the middle of a week. They are entitled to National Assistance pay for that week but many of them do not receive any pay during the first week. It is deferred until a week later. I know of a man who went to work after about five weeks' idleness. When he was on National Assistance he received £9 3s. because he had a large family. He worked for half a week and received about £7 in National Assistance. He received no more during that first week.
  Men like him have to go to their employers and ask them for money to enable them to live during that week.
  294
  They are not allowed to have the balance made up to National Assistance level and pressure is brought to bear by National Assistance officers to compel them to go to the employer for help. This is not right. In other parts of the country these men receivetheir money each week us they work and the difficulty does lot arise. I hope that the Minister will look into this matter.
  The Minister has said that people with large families seem to enjoy a more advantageous position on National Assistance. We all know why. When a person is on National Insurance he receives 20s. for each dependant, but on National Assistance he receives for three youngsters sums of 23s., 28s. and 37s., respectively, and therefore there is a big increase in the income. The principle should be not only recognised but implemented by law and regulation that a person on National Insurance benefit should be entitled to the sum which he would receive if he were on National Assistance.
  Money must be brought into the scheme so that the man on National Insurance shall be at least equal to the man on National Assistance. This would avoid a great deal of trouble and would save many people much mental anxiety. If the Minister examines these matters without bias he will find that there are any number of ways of getting money into the National Insurance scheme which would not penalise the high-income group who should bear a greater responsibility within the nation. There are many people in the country who could well afford to pay more but who do not like to pay out money even for a national charity. The generality of British people, however, are prepared to pay far more than employers are now paying to enable men to receive bigger benefits under the National Insurance scheme. People do not want a scheme which will increase the benefits many years later for those who pay more now. Our primary object should be a scheme which will bring betterment not 40 years hence but now, to enable people to have a reasonable standard of living.
  The nation as a collective society should say to the pensioners that the time has arrived when we are prepared to do at least as much for them as is done in other countries in Europe to

  295
  secure for them a reasonable standard of living now. It could be done. There would be no difficulty at all if politics did not enter into the matter so much and we had a greater moral sense and the desire and determination to help pensioners. Candidates go to the polls and express the desire to do this and that. We should get these things done. We here are the people who should be doing these things. There is no financial difficulty in the way. It is time that we showed ourselves prepared to do something real and warmhearted for out pensioners.
  I do not wish to detain the House further. I have expressed my feelings on the matter, and I believe that I have been expressing the feelings of many people on both sides of the House who are determined that we should use what power we have collectively to look after our aged people better. Is it really suggested that £5 9s. is sufficient for a married couple to live on? After the rent is paid, which may be 29s., there is only £4 left to buy food, clothing, coal and all the rest. No man with any humanity can accept that £4 net is sufficient for all the necessities of the household to give a married couple anything like a sufficient standard of life.
  It is pleasing to hear in the debate that there are to be improvements, but is there the real determination, the collective will within the nation, to help our aged people to have something like a reasonable standard of life? The necessary money could be obtained without real harm to any section of the community. The 4½ per cent. which the workers are paying to swell the funds is helping to meet the financial obligation of paying the level rate pension, but the time has arrived when even the Labour Party ought to look at this level rate pension in a different light. It should be raised far beyond what it has been if we are to do our duty to our old people.
  7.32 p.m.
  Lieut-Colonel Sir Walter Bromley-Davenport: A little while ago an article appeared on the front page of one of our leading daily newspapers under the heading "Means Test Plan"—these words which we have been hearing from hon. Members opposite. The article
  296
  implied that in future a means test would be applied to the payment of State pensions. It also implied that applicants for pension who were in receipt of private incomes, including a pension in respect of former employment and quite irrespective of whether the persons concerned had contributed over the years in order to obtain greater security and happiness for themselves and their families later, would find that their State pension would be reduced or forfeited.
  Many people who read that article assumed that the writer was outlining Government policy. They believed that it was, perhaps, the result of an inspired "leak". Can my right hon. Friend assure the House that there can be no question of reducing people's existing rights to National Insurance pensions? These rights, incidentally, have been improved consistently over the years under this Government's administration. The article has caused grave anxiety in my constituency and, I am sure, in many others among people of all classes who have retired or who are about to retire and live on fixed incomes. The people concerned in my constituency include promiment insurance and bank officials and elderly people whose total income, including State pension, would come in the range of, say, £500 to £1,000 a year. I hope that my right hon. Friend will give an assurance on this point. In that event, there is another question I wish to raise.
  It is useful for the provisions which we make for social security to be publicly discussed, but if that article did not represent Government policy, all I can say is that it brought unnecessary alarm and distress to a very large number of people. Therefore, would it not have been wiser on this occasion for the Government to have issued a public statement on this matter at the time? I realise that it is impossible for any Government to deny all the inaccurate statements which are made in the Press, but if it had been done on this occasion a great deal of worry would have been saved, because the article received considerable publicity. For if statements of this kind go undenied for a considerable time, it can do nothing but harm to Her Majesty's Government.
  Mr. Wood: I understand that there has been considerable interest and alarm

  297
  caused by the article. I take this opportunity to do as my hon. and gallant Friend suggests and I confirm that there is no question of reducing the existing rights to National Insurance benefits.
  Mrs. Slater: Can the right hon. Gentleman go further and say whether the article was referring, not to the particular point which the hon. and gallant Member has raised, but to the suggestion that there would be no future increases in basic pensions without there being a means test? What about that suggestion?
  Mr. Wood: I have made perfectly clear in answer to my hon. and gallant Friend that there can be no question of reducing the rights which at present exist.
  Mr. Mitchison: Before we leave the matter, may I just identify the article? The hon. and gallant Member for Knutsford (Sir W. Bromley-Davenport) and the Minister have been talking about it without direct reference. It was an article published in the Daily Express on Monday, 18th November, and what it said at the end was:
  "The Government is especially determined to tackle the problem of the mounting pensions bill by introducing a means test".
  I do not know whether it was right or wrong, but that is what was said.
  7.39 p.m.
  Dr. Jeremy Bray: I do not wish to cut short this exploration of the Government's future intentions, and I hope that the hon. and gallant Member for Knutsford (Sir W. Bromley-Davenport) will find further enlightenment in the Minister's reply at the end of the debate. I must confess that I thought for a moment that he was doing a clever take-off of the Labour Party's proposal when he started talking about the future for people with rather higher levels of pension. I think that he can be assured that they would stand to gain substantially more from our proposals than they would from any proposals of the Government. I should like to return to this matter later.
  I think that in dealing with pensions every hon. Member is concerned that we should, in the first place, do justice to the individual. We should do justice to the individual's expectations as they
  298
  have been built up over a lifetime of pensions contributions to a variety of schemes and to the individual facing particular needs and family situations living in a community in which there is a rising level of expenditure. But we do not serve the cause of the individual by losing sight of the economic considerations, of the cash.
  I think that the hon. Lady the Member for Birmingham, Edgbaston (Dame Edith Pitt) was a little unfair in rebuking my hon. Friends for overlooking this side of the question. The Minister in his speech did not refer to the economic problem of pensions at all. His predecessor opened the debate last year with a reference to the fact that a limited range of benefits was costing the country £1,400 million a year. To bring this up to date and to extend it a little, the total cost of National Insurance benefits and other current grants from public authorities is running at about £2,000 million a year, or 8 per cent. of the total of personal incomes of the country. That has been fairly steady since 1946. From 1946 to 1957 the figure was 7 per cent. Now it has risen just slightly to 8 per cent. I think that any actuary describing a satisfactory pension situation would expect it to rise to between 10 and 12 per cent. in the course of the next few years.
  In facing this enormous pull on the economic resources of the country one would expect a measure of foresight in the Government's approach. I was somewhat disconcerted when the Minister, in replying to a Question which I put to him on Monday this week, said that the Government would not announce a planned rate of increase because they found that they could get more out of the Treasury by begging from hand to mouth in the situation in which the Government found themselves in any particular year; and that if one considers the supply and demand in the country as a whole one can plead the cause of all the hardship cases which it is possible to trot out and which we all know so well and thus melt the Treasury's heart in a way in which it could not be melted in a cool and deliberate forward projection of meeting the cost of benefits for the country as a whole.

  299
  When one starts examining the total income position of the country one finds that this kind of projection cannot possibly be happening. The Inland Revenue collects a great deal of information about incomes and it has published a very full survey of incomes. However, it does not cover the class of people we are interested in because most of them do not pay tax. The Ministry of Pensions and National Insurance publishes a fine break-down of its own expenditure, but does not co-ordinate it with either the Inland Revenue's figures or the National Assistance Board's figures. The National Assistance Board, too, accounts for how it spends its own money. Now we are to have local authorities applying some sort of hardship test, a sort of means test, as well.
  It will be absolutely impossible to keep track of the needs of the individual as they are met, or are failing to be met, by Income Tax, the Ministry of Pensions, the National Assistance Board and local authorities.
  In the Blue Book containing the national income and expenditure accounts, showing the distribution of personal income, the rather discouraging remark is made that
  "Estimates of non-taxable incomes have been allocated to what seems to be the most appropriate income ranges."
  The figures may be right. There are only a couple of columns of figures in half a page in the national income and expenditure account and it is impossible to form any idea of how far we are meeting the social needs of old people and others in hardship. When one starts wondering why there is this appalling state of ignorance, one finds that there are only two statisticians in the Ministry of Pensions and that the National Assistance Board has no statisticians, although it has a finance and a statistics section.
  Looking deeper still, one finds that the census of 1961, which must necessarily be the basis of the Government's knowledge concerning the composition of households, and so on, has not yet been fully published and is taking second place, no doubt rightly, to paying the Army on the Royal Army Pay Corps computer. If we are to work with this completely obsolete administra-
  300
  tive framework, which all sociologists, whatever their political belief, abhor, we cannot possibly get a sensible basis for tackling the many hardship cases which we present to the Minister.
  Will the Minister use his good offices with the Registrar-General to make sure that we get out of this position as quickly as possible? If he asks the Registrar-General for an up-to-date sampling frame so that he can get a quick reply to any question which he asks about income distribution or the position of different classes of hardship case, then the Registrar-General, with modern methods of sampling, can give him the answer within a month. It needs a simple administrative change from this gargantuan ten-year spasm of the census to a much quicker-acting sampling system within a sample frame devised by the Registrar-General. This is surely the basis for answering all the questions which individual Members can deal with only in terms of personal cases without having a knowledge of their importance to the scene as a whole.
  May I give a further example? The Prime Minister occupied the House's time and his own most valuable time in making a very welcome statement which will cost the Ministry of Pensions and the Treasury £8 million a year. Perhaps the Minister of Pensions will inform the Prime Minister that he can come to the House and make such a statement after every Question Time between now and the election without unduly straining the national resources. He can keep it up for quite a time to come, even until an October election.
  One very sad victim—and there are about 25,000 like him—of this lack of feel for the total national situation, to which I should like to refer in more detail, is the victim of the way that the wages stop is applied bythe National Assistance Board. The effect of this is not to make sure that a worker is not paid more than he would get if he were employed, but to depress the level of wage of the lowest-paid worker. If there is, as there is in the North-East, a reserve of people on the wages stop, an employer knows that he has only to offer 10s. more than the wages stop for a married man, and a single man will be delighted to get the job because it will give him at least £2 or £3 more

  301
  than he is getting on National Assistance. This means that we peg permanently the level of the lowest-paid workers at what the National Assistance Board thinks is the level of the lowest-paid workers but which, in fact, is merely the rate fixed by the National Assistance Board some time before.
  The National Assistance Board Annual Report gives no information about the variation of the way in which the wages stop is applied in different regions. It tells us that in London and the South-East the average rent paid is up to 10s.a week more than in some parts of the country; and coming from another part of the country, one quite understands that this should be met. I cannot, however, see why the National Assistance Board gives no information about the distribution of people who suffer from the effect of the wages stop.
  The National Assistance Board has, I think, a guilty conscience about this. It delights in telling us of the individual cases that it is able to help, the cases to whom it is able to make discretionary additions to their grants—for instance, for the cost of frequent washing of wigs worn by a mentally deficient person whose personal appearance is of great concern to her, and the cost of shaving for a man whose disabilities prevent him from shaving himself.
  We are glad to hear of those personal cases, but we do not hear of the case of a constituent of mine who, under all the rules but one of the National Assistance Board, because he has nine children, would be getting National Assistance of £17 0s. l0d. a week, but who, as a result of the means test, gets his £3 18s. family allowance but only £7 6s. 6d. National Assistance, taking care of a family of eleven people on £11 4s. 6d. a week. It cannot be done. The family is suffering gravely in health. It is suffering gravely in the respect in which inevitably it is held when it is not able to maintain the standards of the solid working-class community in which it lives. If the Minister caused an investigation into the variation of the wage stop from one part of the country to another, he would have cause to revise the way in which it is applied in the regions of lowest employment.
  The root of the difficulty is the difference in the treatment of children
  302
  under the various schemes which the State offers On National Assistance, a man gets about 30s. for each child. The ordinary employed man who is not paying Income Tax gets a 10s. family allowance for the third and subsequent children. The man who pays the standard rate of Income Tax gets 20s. relief of Income Tax or thereabouts on account of his child, plus the 10s. family allowance.
  At the two ends of the scale, therefore, we have the man on National Assistance getting 30s. a week for his children and the man paying the standard rats of Income Tax also getting 30s. a week for his child, but the man in between getting only 10s. a week. Obviously, this will cause all sorts of jealousies within the community between the people who are working and the people who are not working, between those who have children and those who have not. If a more uniform basis for the treatment of children could be devised, it would help enormously. My suggestion is that the Income Tax allowances for children should be set, not against taxable income, but against tax due, so every person, whatever his level of income or the lack of it, got the same sun of money for each of his children. This would get rid of the existing absurdities in the application of the wages stop.
  The other point which I should like to treat slightly also deals with the narrowness within which the pension problem is seen in this country. My hon. Friend the Member for Coventry, East (Mr. Crossman) pointed out that the transferability of pensions in private pension schemes was a cardinal point of importance for industry and for the economy. The Government feel that they have done something about this. They feel that the State superannuation scheme, requiring transferability up to the level of the State superannuation pension, has gone a step towards meeting the case, but this is not so at all.
  Generally, the kind of person who is stopped from moving because of his pension rights often has an income greatly in excess of £15 a week. This is highly restrictive to the effiecient use, not only of scientists and engineers, but of all grades of management who, held within an organisation, are unable to respond

  303
  to the pressures of the market and to the opportunities which are open to them. I recall a phrase used by the right hon. Member for Reigate (Sir J. Vaughan-Morgan), who, in dealing with this point, said that the object of a private pension scheme was to secure employees to one's service.
  A hundred years or more ago, the House of Commons abolished slavery. Now, we are having this form of the slavery of the private pension scheme shackled upon us as the Government force the spread of private pension schemes as the cost of a completely transferable scheme.
  Mr. Eric Lubbock: Does the hon. Member agree that in addition to the categories of people he has mentioned, sales representatives are particularly affected by the lack of transferability?
  Dr. Bray: Yes; I certainly include all branches of executive and management people generally, although they are not the only people affected. Letus consider those who are declared redundant because their firm is contracting or is moving or developing in some way. When a man who has a contributory pension scheme leaves his job, he generally is repaid his own pension contributions with an appropriate rate of interest. The contributions of the employer, however, simply go back into the "kitty". There are some private pension schemes—the I.C.I, scheme is one—in which a worker who is declared redundant is given the option of taking his pension rights with him or of taking a deferred pension, if he has five or ten years' service. Even this provision, however, is not available to the worker who has the enterprise to move into another job when he sees the red light, when he sees the redundancy coming and so oils the wheels of the economy by his own initiative. We get no response here from private employers to make pension rights transferable when a man moves on his own initiative.
  A third class of person who is affected by transferability is the public service pensioner. Many of us on this side of the House have pressed the Minister of Education to allow teachers to return to teaching without loss of their pen-
  304
  sions as a result of the money which they are able to earn. This is important to meet the great need for teachers today and in the years ahead.
  If public service pensions were transferable, we could not in equity stop that pension on an earnings test when a person had retired, because a civil servant or teacher could argue that he could just as easily have transferred the day before his retirement into some other occupation, taken an inalienable pension right with him and then gone on earning after retirement age. This is a highly desirable reform.
  The Minister does not give weight to the social aspect of the question of transferability. I think that perhaps this is because few hon. Members opposite have actually been members of private pension schemes; most have generally been administering them. The hon. Lady the Member for Edgbastonwas a member of such a scheme, but she is in a minority.
  I have had representations from Tory candidates asking us to get something done about transferability before the next General Election so that when they entered the House they would not lose their rights. Purely as an acedemic point, one may point out to them that they are so unlikely to come here then that they need not worry. But the party opposite is definitely suffering in the range of people it represents because employees in industry are unwilling to lose their pension rights to come here as Conservative M.P.s. There is a generous thought for the Minister.
  Obviously, if we are asking for transferability we must have some idea of the cost. It is extremely difficult to give an estimate. The hon. Member for Bradford, West (Mr. Tiley) suggested that we should be able to give it, but in view of the lack of information from the Government I did not think this a fair rebuke. But on certain assumptions one can make a rough estimate.
  Looking at a particular private pension scheme, I gather that the level of refund of employees' contributions to people leaving the firm runs at about 25 per cent. of employee's contributions. Therefore, in one year, if £1 million have been contributed by the employees, £250,000 are paid back to employees

  305
  leaving the employ of the company. That is about 1 per cent. of the total income of the employees.
  Assuming that one-third of the workers in the country are in private pension schemes, the additional cost of transferability would be about £70 million a year throughout the existing private pension schemes. If we had a pension scheme covering the whole of the working population, then the 1 per cent. would work out at about £230 million a year as compared with the £70 million which is relevant now. But the economic effect of transferability would certainly not lead to increasing anyone's costs by £70 million.
  The present situation is that these contributions refunded to employees on changing their jobs are spent. They are currently consumed often in meeting the costs of changing from one job to another. These costs should properly be made by redundancy schemes. But if pensions were transferable then the amount of money at present refunded would not be spent, but saved. The contributions of the employers would also be saved. We would thus reduce spending by £70 million and increase saving by £140 million. Whether the Government wished to use this increased saving or not would depend upon the balance of supply and demand for the country as a whole throughout the year. In those circumstances, if the Government felt that we were already saving enough they could reduce taxation by £140 million to see that demand was maintained.
  This argument has been terribly crude, but qualitatively it is in the right direction. The lack of economic appreciation of the factors involved is what discredits Government critics of the Labour plan. They claim that we have not thought of what we can afford, but we have. We have thought of what it involves, and not only for the Budget which is often just a matter of the way one does sums. We have thought of the effect on the economy itself, and here it is indisputable that a much more systematic approach to pensions would not reduce the amount we spent on pensions but would increase it and also humanise it enormously.
  It is because we on this side of the House have the feeling that the Govern-
  306
  ment have not really got down to the fundamental study of the problems of the Welfare State, in the payment of pensions and the meeting of need, that we have put down our Motion which, if the House reflected the views of the country, would be carried overwhelmingly.
  8.5 p.m.
  Mr. Anthony Kershaw: The Labour Party may have thought out the mathematics of its scheme but it has kept it from everyone else. That is our complaint, and, in spite of the most urgent temptations, the hon. Member for Coventry, East (Mr. Crossman) persisted in saying that he could not possibly give any financial estimate of the cost of the Socialist scheme because he did not know what the level of National Assistance would be early next year. If that is not the feeblest excuse I have ever heard n my life, I should like to know what is.
  I was a little intimidated when I read in Dod that the hon. Member for Middlesbrough, West (Dr. Bray) is a professor of mathematics.
  Dr. Bray: I never have been a professor and I air afraid that I never shall be.
  Mr. Kershaw: The write-up does the hon. Gentleman no more than justice. What did appear in the hon. Member's remarks about transferability was the hatred which hon. Members opposite have for private enterprise and all that goes with it I have never been able to understand the argument that it would be so much better to fix the level of pension benefits, in all their complicated ramifications, at a certain date and then tie them to some figure either in the national income or in the cost of living.
  We must remember that, if the Government had adhered to the level of pensions fixed by the Socialist Party when in office, which it considered suitable then, the pensioners would now be 55 per cent, worse off than they are. What possible argument can there be for that? We have had this argument before and I simply do not understand why the party opposite should constantly put it forward.
  Like other speakers on this side of the House and one speaker from the opposite side—the hon. and learned Member

  307
  for Kettering (Mr. Mitchison)—I congratulate the Government upon the steady expansion which they have been able to effect in retirement and other pensions. They have improved the levels to keep ahead of—and, indeed, to gain on—the cost of living. The result is that they stand at 55 per cent. better in real terms.
  Today's announcements were very satisfactory, but while all the things that have been said about them are true, and we in this House may take such credit as we deserve, we must nevertheless reflect that those becoming old and lonely at the present time will hardly be comforted by a calculation in percentages of whether they are a little better or a little worse off. Rather will they compare themselves with the hon. Member for West Ham, North (Mr. A. Lewis), living next to them, who has a very much larger income than they have. I am not trying to be offensive to the hon. Member or to pick on him. I am merely saying that older people compare themselves with their neighbours rather than with what their own situation may have been five years ago.
  Mr. Arthur Lewis: The hon. Member may not have been picking on me but he mentioned my name. He could also have mentioned almost every other hon. Member opposite. His hon. Friends have vast incomes, many of them unearned, and most of them have never even troubled about the fact that most of the food and commodities, including rent, which the pensioner must pay have gone up in cost much more drastically over the last few years than ever before.
  Mr. Kershaw: I agree. I could have chosen any other hon. Member present, but the hon. Member for West Ham, North (Mr. A. Lewis) does fill the eye more than most and I happened to pick on him.
  Can we afford in our future policy to pay to all an income sufficient for a reasonable standard of living, irrespective of age, merit, health, other resources or savings which any individual may have? If any increase over the basic minimum pension is made, it must be based upon an increase in contributions. I think that both sides of the House largely agree with that, for anything else
  308
  strikes a blow at the savings and independence which are rightly valued by the individual.
  Secondly, these very large increases in contribution paid solely to the State, as they may well be, will afford the State through its investment policy large powers of intervention in our economy in the future. It is no secret that this was one of the attractions to the party opposite of the scheme of the hon. Member for Coventry, East before it was abandoned as mathematically incorrect and practically impossible. The party opposite foresaw that very large funds in the hands of the State would permit very interesting and drastic development of our economy, if they were invested in certain ways.
  If it is intended to alter or socialise or nationalise our economy in any important way, it would be very much better for the party opposite to come before the electorate and to say plainly exactly what is proposed than to say that with the aid of very large funds, which hon. Members opposite will by law extract from everybody in the community, they propose to alter the circumstances of our economic and national life. Therefore, it is desirable that there should be left to individuals some choice of the type of retirement pension or insurance which they have, whether they should go into a State scheme, a private scheme, or make some other provision for their own future.
  I therefore conclude that the general lines of present Government policy, a graduated scheme with the possibility of opting out over a basic minimum, are sound and should be applied in future and not wholly discarded. If a substantial pension means substantial contributions, as I think it does, the thought for the people is whether they are prepared to pay. The contributions will be very much larger than we are now used to. Over the years, other countries have become used to much larger personal contributions towards their various insurances than we accept in this country, notably in Germany. I am sure that we will have to face that necessity.
  We are then left with the difficulty that if contributions are very high, there will be an increasing number of people not able to afford them, because they

  309
  fall out of work, or are late entrants, or for various other reasons. It is for those people, whose number may be rather large, that the basic pension must continue to exist, with some element of National Assistance. I take the opportunity to pay tribute to the way in which the National Assistance Board and its officers do their work. I know that hon. Members, will agree that nothing could be more sympathetic or more skilled than the way in which officers throughout the country work.
  There are one or two points on National Assistance which I should like to urge on the Government. The first is that in country constituencies such as mine, where there are elderly people living in remoter areas, there are certain expenses which add to the cost of living, delivery of groceries and travel and so on, and which are greater than those incurred in towns. I wish that these things could be given more weight in National Assistance grants than is now the case. Some account is taken of them, if my information is correct, but I do not think that the difficulties encountered by old people living in the country, compared with those living in the town, are given sufficient weight. Last year, I mentioned renting a telephone, which for country people is tremendously important, not because they necessarily want to use it, but because they want to be able to get in touch if there is an emergency at home.
  While paying my tribute to the National Assistance Board, like other hon. Members I look forward to the day when it will not be necessary for old people to have National Assistance. As the hon. and learned Member for Kettering said, it was devised for the disasters, for the personal accidents, for those who fell out of work or met some other disaster at home. But those people are not necessarily old. I look forward to an increase in the basic pension and, far more, to a greater variety of measures which individuals can take to increase their income after retirement.
  This leaves the basic pension fairly low in the priorities, but there are certain individual classes which have only the basic pension and which have to be identified, but which can be helped. If we approach the problem on a personal
  310
  basis, as National Assistance officers are bound so do and as they do very well, we will perpetuate the means test sort of approach. That is inevitable and we could not do otherwise. It would be socially advantageous if we could get rid of that approach and identify whole groups of people, the very old, for instance.
  I have great sympathy with the idea of increasing pensions for the very old whose expenses rise gradually, never getting less and never getting much greater, but getting greater every year. There is a clear case for doing something for these people, who can be easily identified. It would be done not personally, but by category. I hope that my hon. Friend will be able to say that he is taking that idea aboard for his deliberations.
  8.18 p.m.
  Mr. Eric Lubbock: The hon. Member for Stroud (Mr. Kershaw) asked whether there could be higher National Assistance benefits, but his question was rhetorical, because he went on to say that higher National Insurance contributions would then have to be paid. That illustrates that the country as a whole and its political thinkers have become hidebound and require a fundamentally new approach to the social security system. I hope to be able to demonstrate that the hon. Member's is not the only solution. I agree with the hon. Member for Reigate (Sir J. Vaughan-Morgan) about the need for a review of the social security system and his hope that something canbe done to cut across party lines. It is a great shame that in these debates on pensions and other farms of social security we tend to turn the House into a political forum. This speech of the right hon. Lady the Member for Birmingham, Edg-baston (Dame Edith Pitt) was an outstanding example.
  If we can get agreements on social security cutting across party lines, they must be concerned with general principles rather than with specific details. We shall all disagree when we discuss the exact amounts to be paid to each beneficiary. My remarks will be concerned mainly with principles. I think, first, that the basic level of pensions and other social security benefits should be fixed at a higher level so that people

  311
  do not have to apply for National Assistance. I am sure that that principle is generally accepted by both sides of the House.
  Secondly, once the benefits have been fixed at that level they must not lag behind earnings. I am not saying that they have done so in the past, but they started at levelsvery much lower than those of subsistence. Therefore, the first thing must be done before we get round to tying them to national earnings.
  Thirdly, the income from the State scheme—that is apart from any benefits provided under occupational schemes—at times of sickness and unemployment must bear a fixed relationship to an individual's previous earnings, and I am glad to see that the Government have accepted this principle in their Amendment to this Motion.
  Fourthly, these benefits should be provided by a combination of Government and private occupational schemes. I agree with the Minister's remarks that one should leave as much as possible to individual initiative, and I shall later deal with the relative proportions which we think are appropriate.
  Lastly, I think that the social security scheme must be as simple as possible to minimise the cost of administering it.
  I propose to examine our proposals to see how far they fit those criteria. We do not expect to introduce our scheme in one or even two years. It is so revolutionary that it will take five to seven years to apply all its provisions.
  We differentiate between unemployment and sickness on the one hand and retirement pensions on the other. Dealing with sickness and unemployment benefit, we believe that the minimum should be two-thirds of the level of previous individual earnings, with a maximum of four-thirds of the average level of all industrial earnings; a minimum of half the average level of industrial earnings for a married couple, with five-eighths of that amount for a single person, those proportions being roughly the standard rates of benefit at the moment. I do not think that the difficulty in determining average earnings is insuperable. One way of doing it is to use the previous tax return of an individual as a basic guide.
  312
  I said that we would deal with pensions in a simple manner. We would have a basic pension of 50 per cent. of average industrial earnings, which, as hon. Gentleman opposite are so keen on figures, would amount to about £8 for a married couple at the moment, with five-eighths of that figure, or £5, for a single person. I want hon. Gentlemen opposite to bear in mind that I am talking about a scheme which is to be introduced over a number of years. These proposals represent a fairly large rise on present levels, and it would be impossible to introduce them straight away in one measure, coupled with the benefits about which I am talking
  This rate, and also the maximum and minimum unemployment or sickness benefits—which as I explained would be related to average industrial earnings—should be adjusted periodically to take account of increases in that average. This could be done in one of two ways—either by adjustments at fixed intervals of one or two years, or by making the adjustment automatic consequent on a rise of a given percentage in the average. Whichever way one does the sum, the end result is simple. It is to ensure that the pensioner, the sick person, and the unemployed man, share pro rata any increases in the standard of living of people who have jobs and who are participating in the general rise of the nation's wealth. Not only is that very much fairer than the present system of arbitrary increases, but it fulfils those criteria which I mentioned. It takes the subject of pensions and social security benefits out of the political arena altogether, an object which I believe to be desirable in itself.
  Having raised the level of basic pensions to what we believe to be an adequate subsistence level, we propose to abolish the graduated scheme altogether.
  Miss Margaret Herbison: I followed with great interest what the hon. Gentleman said would be the benefit for a married couple and a single person. He said that it would be some time before they received £8 and £5, respectively. In the meantime, what proposals has the Liberal Party for dealing with the real hardship which retired people are suffering now?
  Mr. Lubbock: I did not say that there could be no immediate rise in benefits. I said that the increase we envisaged was such that no one would expect it to be paid in the immediate future.
  Mr. A. Lewis: What does the hon. Gentleman mean by the "immediate future"?
  Mr. Lubbock: At least I am mentioning some figures, which is more than what the hon. Member for Coventry, East (Mr. Crossman) said.
  I was about to say why we objected in principle to the graduated scheme. The intention of that scheme was to bridge the gap between the State scheme and occupational pension schemes. The Minister brought out the fact that the effect of the graduated scheme was purely marginal. That is why so many private employers are contracting their employees out of it. The number is increasing all the time.
  Secondly, the graduated scheme provides a worse bargain—and this is another reason why employers are contracting out of it—than that provided by many of the occupational schemes which can be obtained from commercial assurance companies. Broadly speaking, this is true for any employee who is earning more than £12 to £13 a week, so one finds companies devising schemes by which all the employees earning more than that figure are contracted out, while those earning less than that sum are contracted in. The scheme can never work because there is an element of redistribution. It means that the people at the top of the scale are getting a worse bargain than those earning less than £12 to £13 a week, and the larger the number of people earning more than £12 to £13 who are contracted out, the more financially impossible the graduated scheme will become.
  Finally, the graduated scheme is extremely burdensome to operate. This applies not only to the Ministry of Pensions and National Insurance, but to every company which has to do all the arithmetic on behalf of the Government.
  In place of the graduated scheme we would encourage occupational schemes wherever possible, in order to bring final retirement pensions up to the level of about two-thirds, or 80 per cent., of final
  314
  earnings. We could do this by providing model schemes for employers to copy and where wage: boards existed we could even require employers to provide this kind of benefit in supplementation of the State scheme. Where people were not covered by occupational schemes in supplementation they could continue to take out annuity policies and receive tax relief on them, as they are entitled to do under the 1956 Finance Act. But we would propose that part of their contributions paid like this should be financed by an additional sum from the Government, in the proportion of three-fifths of whatever contributions they made, and that this scheme should be financed by a levy on all employers who did not provide occupational schemes for their workpeople.
  The other major change that we propose is that the entitlement benefit should no longer be based on the record of contributions, but only upon citizenship and resident. This means that we would make no distinction between contributory and non-contributory old-age pensions. The person who reached retirement age would be entitled to a retirement pension as of right, no matter what his contribution record might be, provided he fulfilled certain conditions as to citizenship and residence. Both classes of people, who are treated separately at the moment, would receive the same standard rate of benefit. This would result in considerable administrative savings and would also not be very expensive, because most of the people concerned are receiving National Assistance at the moment.
  The Annual Report of the National Assistance Board for 1962 shows that of the 114,030 non-contributory old-age pensioners in December, 1962, no fewer than 85,000 received National Assistance supplements, and that those supplements brought their average incomes, taking pensions and supplements together, to considerably more than the ordinary basic pension. The figures were 71s. 10d., compared with 57s. 6d. This change would not be very expensive, and the number of people in this group is rapidly diminishing. Seventy-five per cent. of non-contributory old-age pensioners were over 80 years of age on 9th October, 1962, which was the date selected for this examination by the National Assistance Board.

  315
  Since, under this scheme, the retired old-age pensioner would receive the retirement pension as of right, on reaching the age of 65 for men or 60 for women, the present arrangements for people continuing to earn by working after retirement age and continuing to receive a pension at the same time would be scrapped. This would bring consequent administrative savings.
  We also propose to abolish the earnings rule for widows and pensioners. I heard one hon. Member opposite say that he had mentioned this subject several times in previous debates. I put it in my election address two years ago, and have spoken consistently about it ever since. I am glad to see that we are going a little way towards the principle of abolishing the earnings rule, and I hope that this is only the first step towards getting rid of it altogether.
  We consider that the earnings rule prevents many widows and pensioners from taking jobs when they are still quite capable of doing so. At a time when there is so much talk about raising the gross national product by 4 per cent. per annum it is a great error to have, as an integral part of our social security structure, a provision which acts quite deliberately as a disincentive to people to work.
  It is not even fair, because unearned income received by widows or pensioners is totally disregarded in calculating their entitlement. We believe that the implementation of our proposals would remove much of the need for National Assistance. It is calculated that as high a proportion of 90 per cent. of those receiving National Assistance payments at the moment would not need them if our proposals were carried out. There would then be no justification for continuing the National Assistance Board as a separate department. In fact, it might streamline the administration now if we created a single Ministry of Social Security, in which we merged the functions of the Ministry of Pensions and National Insurance and the National Assistance Board.
  I want to deal with the methods of financing these greatly increased social benefits about which I have been talking. We dislike the flat-rate contribution system, which the hon. Member
  316
  for Stroud seemed to think was the only way in which social security benefits could be financed. We also, dislike mixing up the payments which people make, through their stamps, for National Insurance benefits, with those that they make as contributions towards the National Health Service, which amount to about 2s. 8½d. on every insurance stamp. We would take this out altogether and finance National Insurance and the National Health Service entirely out of taxation. We hate the paraphernalia of stamps and cards, which seem to appeal so much to the bureaucratic mind.
  As I say, first, we should make the whole of the National Health Service a charge on taxation, but abolish the graduated scheme altogether and replace the fiat-rate contribution which people pay now by a graduated social security tax which would be a proportion of the income of the people concerned. It would be one-third paid by the employees and two-thirds by the employers. No records would be kept of individual contributions. These would not be necessary as a record of contributions would no longer establish an entitlement to benefit. We think that the level would have to be at about 12 per cent. of incomes and therefore the contributor would pay 4 per cent. and his employer 8 per cent. This as I realise is a very much higher rate of employer contribution than is the case at present. But, as was emphasised by several hon. Members, this would bring us closer in line with the situation in many countries on the Continent.
  I think that the Labour Party scheme would be very much more expensive, if they accept the figures which I have given of what should be the benefits, because they would have to begin by building up the national pensions fund which is referred to in their green booklet. I am ashamed to say that I have read it only once, but I think I understand what it means. While this national pensions fund was being built up they would have to continue to pay for current benefits out of contribution from the people concerned. I also object to this building-up of the national pension fund because it appears to me to be a type of back-door nationalisation, and I agree with the hon. Gentleman who said

  317
  that he would prefer this to be done openly rather than by a scheme which might be calculated to mislead the public about the intentions of the Labour Party.
  Another reason why the Labour Party's scheme would be more expensive than ours is that retirement pensions, the largest by far of the calls on the National Insurance Scheme, will be related to individual earnings, just as payments for unemployement and sickness are under our scheme. The payments for retirements in 1962 amounted to about £740 million whereas payments for sickness benefits, for example, were only £36 million. Therefore, if sickness and unemployment benefits were wage related in a basic scheme that would be much less expensive than applying it to retirement benefits as well. I dislike the Labour Party's scheme because it does not seem to give adequate scope for occupational schemes, and I agree with the Minister that so far as possible it is a good thing to leave room for individual incentive.
  The Tory Party claimed to have doubled the level of benefits over the last 10 years. I have heard that stated in one or two speeches and it has been used in Tory Party advertisements as well. But hon. Members opposite ignore the fact that between October, 1953, and October, 1963, the index of retail prices rose by almost precisely one-third; so that in 1963 the £ was worth only 15s. at 1953 prices. Instead of having doubled in the last 10 years, the real value of the basic pension, unemployment benefit or sickness benefit—there is not much difference between the rise of the one or the other—has risen by only 50 per cent. from the appallingly low values which obtained 10 years ago.
  The fact that nearly 2 million people were on National Assistance in September, 1963, which, incidentally, was the highest number for any September since the scheme started, shows that in relation to present-day needs—and that is what we are concerned about—the benefits provided by National Insurance are not at all realistic. No less than 22·6 per cent. of pension households were receiving supplements in June, 1963, and the Minister admitted that this was almost the exact proportion as at the end of 1961.
  318
  We maintain that the benefits must be improved substantially. We also maintain that this by itself will not be enough. There must be a radical overhaul of the whole of our social security system. That is something we shall never get so long as the present Government last.
  8.41 p.m.
  Lord Balniel: It is a great pleasure to follow the hon. Member for Orpington (Mr. Lubbock) after his lucid exposition of Liberal Party pension policy. Obviously, it is impossible for me immediately to comment on it. I shall not attempt to dissect or criticise him. Rather I welcome two broad features immediately.
  The first was the emphasis which he placed, I believe rightly, upon pensions being a combination of Government action and private occupational schemes. These dual pillars to sustain dignity in old age seem to be the right emphasis. The second feature of the policy which the hon. Member explained, and which I particularly welcome, is the fact that the Liberal Party, unlike the Labour Party, has at least had the guts to give some figures both as to pensions and the means of financing them.
  Like other hon. Members, I very much welcomed the news that we were to have a debate today on pensions and National Insurance, because in my innocence I had assumed that at very long last the Opposition would explain something about its plan for the reconstruction of social security. I had imagined that at long last we were to be told the scale of the pension which is being promised. I imagine that at long last we would be told how it is to be financed, and perhaps we would even be told how much contributors would have to pay. I am sorry that the hon. Lady the Member for Lanarkshire, North (Miss Herbison) is leaving the Chamber, because I had hoped to refer to her.
  Miss Herbison: I was going to listen to the debate from another part of the House.
  Lord Balniel: Do not let me detain the hon. Lady; I was going to mention her only in passing. I of course have read—not three times like the Minister but once—the pamphlet entitled New Frontiers for Social Security. I must confess, having listened to the hon. and

  319
  learned Member for Kettering (Mr. Mitchison) and to the author, the hon. Member for Coventry, East (Mr. Cross-man), I find these frontiers as undefined, as misty and vague as they were when they were originally put into the pamphlet.
  Like other hon. Members, I want to concentrate my remarks on the future, on the policies we should pursue and the direction in which we should march and also on how we should try to re arrange and reorientate our structure of social security so that we can make a new drive towards eliminating poverty in old age and a new impetus in ensuring dignity for elderly people. I want to talk about policies for the future, rather than administration in the past. I feel though bound to say a word or two about the Labour Party plan because all the facts and figures of the plan are, of course, known to hon. Members opposite. The hon. Lady the Member for Lanarkshire, North who has now disappeared—
  Mr. A. Lewis: That should not be said because my hon. Friend did wait for a time and the hon. Member for Hertford (Lord Balniel) did not mention the point he now wishes to make. If he wishes to talk about people leaving the Chamber, he should note that not one hon. Member opposite who has spoken has stayed for any time to listen to the debate.
  Lord Balniel: I have no intention of being unfair. I was merely going to say that the hon. Lady, who I believe is listening to me in another part of the Chamber, in introducing this new Labour Party Plan to the Labour Party Conference said that the plan was based,
  "on detailed and rigorous technical, financial and actuarial advice."
  It would be interesting to see the actuary's affidavits on this plan. If it is based upon actuarial advice and if it is based upon a technical examination of the facts, why can we not know about it? What is so secret? What is it that hon. Members opposite do not want the British public to know? The hon. Lady the Member for Lanarkshire, North and I share in common the heritage of Scottish culture. I remind hon. Members opposite of the poem
  320
  which was addressed by the Scottish National poet, Robert Burns, to Members of Parliament. Robert Burns wrote this:
  "In gath'rin' votes you were na slack;
  Now stand as tightly by your tack;
  ne'er claw your lug, an' fidge your back, An' hum an' haw;
  But stand up straight, an' tell your crack Before them a'."
  Hon. Members opposite ought to stand up straight. They ought to defend their pension policy with facts and figures. They ought to be prepared to allow the British public to know something about what is involved, what benefits will be received, and what contributions will be paid.
  Mr. Edwin Wainwright rose—
  Lord Balniel: No, I will not give way. The time is short. Perhaps it would be expecting too much to know what the minimum guaranteed income should be. Let me say in passing that I share the Labour Party's view that this minimum guaranteed income is the right way of tackling the problem. I welcome the principle of the minimum guaranteed income for old people. The way the Labour Party is treating it though is almost like a turkey which is being fattened up for production just before Christmas. Public expectation is being built up about this minimum guaranteed income, but it will be produced at the last possible moment before the general Election. It will be produced before a bewildered and amazed audience, including many unsophisticated and rather humble people. They will not have time to work out the sums.
  Miss Herbison: The noble Lord has been taunting us for not giving figures. The Conservatives now form the Government. His Minister has spoken today. If the noble Lord really believes in a guaranteed minimum income, as we do and say we will operate, it is for his Minister or for the noble Lord to state the figure which they think should be the guaranteed minimum. They have the chance to do so at this moment.
  Lord Balniel: The right hon. Member for Belper (Mr. G. Brown) wishes to speak in a moment or two. I should like

  321
  to ask him two questions. One of the three aims in the Labour Party pension plan is
  "To finance the improved benefits by substituting wage-related for flat rate contributions."
  In the place of flat-rate contributions there is to be a graduated contribution which will be a fixed proportion of all earnings up to an upper limit.
  Mr. Mitchison: Also a percentage of the payroll. One could get quite a lot from that.
  Lord Balniel: That is interesting, but on page 14 of New Frontiers for Social Security the words appear not so different from mine, for the pamphlet states:
  "In future the contribution will be a fixed proportion of earnings subject to an upper limit".
  The right hon. Member for Helper is a trade unionist and he realises that this question is of crucial importance to every employee. It is a simple question. What proportion of the earnings of employees is to be set aside in this way as a compulsory contribution to the Labour Party plan? If the right hon. Member will take out his pencil and make a note of that question my hon. Friends and I would be grateful for an answer when he winds up the debate.
  There is a further important question I wish to put to him. The present Government's scheme will, by 1975, cost about £1,800 million. Harold Wincott, writing in the Financial Times about the Labour Party's scheme, suggested that its cost might be nearly double that figure. The proposal in the Labour Party plan is that a tripartite system of financing pensions based on the Exchequer, employer and employee should continue, each contributing a "fair share." Today employers and employees contribute 40 per cent. each. It is reasonable to ask a great political party like the one opposite, who will be seeking to form a Government in due course, what share do they think should be borne by the employee, the employer and the taxpayer?
  Surely those two extremely simple but absolutely fundamental questions can be answered in a whole day's debate devoted to pensions, the care of our aged and the ensuring of dignity and security of elderly people. I have been
  322
  asked to curtail my remarks a few minutes before nine o'clock, and so I will not be able to deal with other aspects which I should have liked to discuss.
  8.53 p.m.
  Mrs. Harriet Slater: Only five minutes remain for me in which to speak, so I hope that the noble Lord the Member for Hertford (Lord Balniel) will forgive me if I do not answer his questions. I will leave that to my right hon. Friend the Member for Belper (Mr. G. Brown).
  Today the Prime Minister announced an increase in benefits for widowed mothers and a relaxation of the earnings rule. During the afternoon I have been trying to discover from my hon. Friends whether the Prime Minister said when the increased benefits would come into force. Or are they merely more promises which the party opposite will say they intend to fulfil after the next General Election?
  Last week the Prime Minister was questioned on how soon he would make a statement about pensions. He promised to do so quite soon. Apparently today's statement is the only one he is prepared to make at the moment. When he was questioned last week he was not asked about particular items of pensions but about the whole concept of social security benefits. So far we have not hada statement from the Government as to whether or not there is to be an increase in old-age pensions, industrial injuries benefits and other social security benefits. As has been suggested, it may be that week by week the Prime Minister will make piecemeal statements to the House rather than making a comprehensive announcement before the General Election.
  Many figures have been bandied about during today's debate. I am more concerned with the economic factors confronting the elderly, knowing that the average old-age pensioner cannot possibly adequately achieve a decent standard of life. The old, sick, unemployed and others receiving benefits are living on sums of money on which hon. Members apposite cannot credit that they can exist. Last Saturday someone came to see me after having been turned down by a medical board for the payment of industrial injuries benefits. This

  323
  person attempted to go to work but collapsed. This week he does not have a penny on which to live, and is in absolutely dire straits.
  The hon. Lady the Member for Birmingham, Edgbaston (Dame Edith Pitt) agreed that the basic rates of benefit are not enough to live on. This is so true. Each week I visit my grocer and take note of the prices of food. When I visit my butcher I wonder how in the name of fortune some old-age pensioners can buy not the luxuries of life but the bare necessities on which to live.
  It is time that the Government realised that those in receipt of social security benefits should receive a further increase. Despite this, we will probably get the old story again tonight. We shall be told by the Minister how much the Government have done for old-age pensioners. I hope that hon. Members opposite realise that improvements have been made only after pressure from my hon. Friends.
  Whatever may be said about the amount of money needed by the elderly, certain things are necessary to them. They must pay for their rent, light and coal. I see hon. Members opposite laughing at these remarks, and I invite them to try to live with no other resources than the basic old-age pension. This is a nation of two classes of people. Those who pretend that we are getting towards the classless society have no conception of the two nations there are at present.
  The hon. Lady the Member for Edgbaston said that middle-class people were always asking her, "How are we to pay for these benefits?" They did not want to pay. But those same people should remember that we have to pay towards some of their middle-class educational benefits, and all the other things they have, and which all people should have by right. I believe that the general public, not an isolated section, would be prepared to pay in order that the aged, the unemployed or the sick should have a decent standard of living which kept them off National Assistance.
  It is a disgrace that today we should compel thousands of old people, and other people, to apply for National Assistance in order to get a decent
  324
  standard of living. Those who believe that these people do not mind applying should come to some of the Labour Members' surgeries, not to those of Tory Members; they will find that people are frightened to death lest they should have to go on National Assistance.
  The hon. and gallant Member for Knutsford (Sir W. Bromley-Davenport) was worried about articles in the Daily Express on the means test. I want to ask a straight question, to which I hope to get a straight answer. If the Government are returned again, which is not very likely, do they intend to lay down a basic pension which will not increase at all, and that, beyond that, everyone will be forced to have a means test? That phrase has been used, and I say that it is the intention of many in the Tory Party to extend the means test. If we want the answer we only have to read a Tory publication, which says that in the affluent society we ought in social security matters to move nearer to the means test. I believe that to be the basis of Tory social security policy.
  9.0 p.m.
  Mr. George Brown: This has been an interesting debate inmore ways than one and particularly in the fact that the approach from the other side of the House is one that fits in with the difference between our Motion and the Government Amendment. The Motion we are offering the House asks for a fundamental and radical change in the approach to the problem of providing an adequate minimum income for those who, for one reason or another, are unable to earn. By implication, we accept in our Motion that the present arrangements are not suited to the requirements of 1963, and we suggest ways in which a change could be made.
  The Government's Amendment, on the contrary, notes with satisfaction, and the usual smugness, that this, that and the other has happened during the last 12 years. It indicates no concern with the existing situation, no concern with the way in which the financing of the scheme is proceeding; it simply hopes that the Government will do the best they can. The difference in the two approaches has been mirrored throughout the various speeches.
  As my hon. Friends have said, the background to this debate is one of

  325
  poverty—poverty arising from levels of income inadequate to provide people with a decent and acceptable level of subsistence. It is a problem of a poverty that is both absolute and relative. It is poverty absolute in the sense that the incomes provided for very many of these people are not enough to give them an adequate standard of living.
  On the other hand, poverty is not only measured in absolute terms but in terms relative to the age in which one lives, and the environment in which one lives, and to the things that other people are having. It is true that if the affluence of which the party opposite is so apt to boast has increased for certain groups in the last 12 years and that the standard of living of those groups with which we are now concerned has not kept pace with that increase, the relative standard of poverty of the latter groups has clearly worsened. That has led to a great deal of hardship and humiliation by pushing these people to the point of confessing their poverty, in seeking some amelioration of their poverty and, with great respect, members of the party opposite seem to give that situation less recognition than it deserves.
  It is, therefore, no answer to the charge to refer to what the situation was in 1946, or 1948, or 1951, or to what has happened over a selective period of years in between. We all know that we can pick any period of years between 1946 and 1963 and produce almost any picture we like of the quantitative changes that have taken place. If we talk, as the Minister talked, of a 50 per cent. increase in real terms between 1951 and today, we get one result. If we take the period from 1946 onwards, the result is different, and so is the result if we take the period from 1958 onwards—and so it goes on. But, whatever result one gets, it is no answer to the charge we make to say that this or that change has occurred in that period.
  The point is that people are living in 1963, testing their income and their capacity to obtain a standard of living against 1963 needs, against what people are entitled to expect in 1963, and they are buying their way at 1963 prices in competition with other groups of the community around them. Therefore, the standards of today are more important, and the standards of this group of the
  326
  community relative to those of the others matter enormously.
  Our submission is that the Government's actions over the 12 years have produced a relative position different from that for which the Minister claims credit. In the first place, their actions have increased substantially the number of people who are pushed beyond National Insurance benefits to the National Assistance Board in order to get anything like a reasonable standard. One of the odd and revealing things is that the Minister claims this as an achievement. He explained that, because the Government had done certain things, more people are now going to the National Assistance Board.
  It cannot be an achievement. It is a retrogressive step from all that all parties said they were committed to during the time of the Coalition Government and immediately after 1945, which was that National Assistance should be a safety net for the great bulk not adequately provided for by National Insurance. Now that the Minister admits that the Government's actions have changed that, he is admitting one of the major criticisms of what the Government have been doing. They have broken one of the bases not only of the Beveridge Report but of the national attitude to National Insurance and social welfare at that time.
  The second thing that they have achieved by their own actions is that they have widened the gap considerably between benefits and earnings and, therefore, quite apart from any reductions in standards, they have increased the sense of tragedy and hardship. If a man is unemployed, or he falls out of work because of sickness or any other reason, he comes down from his precarious but nevertheless reasonable standard of living, largely based on hire-purchase and other deferred payments, a very much longer way as a result of the greater fall in his income because of the widened gap between benefits and earnings.
  The third thing that the Government have done is that they have switched the incidence of cost very heavily from the general taxpayer to a direct tax on the insured person. It is still taxation, but a very large part of the insurance contributions today are paid in the form

  327
  of a direct tax, with the difference that whereas when it is borne on the general taxation structure it is, broadly speaking, allocated in accordance with the assessed ability to pay, whereas when it is switched to the insured worker it becomes a poll tax which has no relation to his ability to pay. The lower he is in the scale of earnings the heavier and harsher the tax becomes. Whereas it was roughly two-thirds between employer and employee on the one side and one-third on the taxpayer at the other end, it now becomes something like four-fifths borne industrially, with a very large increase in the insured person's stamp, and one-fifth borne by the general taxpayer.
  This has enormously changed the character of the scheme, and the relationship between benefit and contribution, and it has largely changed the taxation structure and the part we play in it. All this has been the outcome of the Government's actions, and, in our view, these are issues which must be tackled by any Government who want to put social welfare and social provision generally in this country back on to an acceptable basis.
  But it does not stop there. The Government have done something else. We have had some discussion today about comparisons between what is done in this country and what is done elsewhere. It is true that not all the details are the same, as the hon. Member for Bradford, West (Mr. Tiley) reminded us in an interjection. As he said, in Sweden the pension starts at 67 and not at 65 or 60. There are other differences. Therefore, none of the comparisons can be exact. Nevertheless, whereas in 1946 Britain was unquestionably in front in social welfare provision, in 1963, make what allowances we like, we have fallen behind a large number of our European industrial competitors.
  One of my hon. Friends has been looking at some documents prepared by a firm of pensions consultants—Noble Lowndes is the name—which has been making an investigation not for any purposes of ours but in order to see where there might be the possibility of private enterprise being undertaken by the firm or those whom it advises. It has made some comparisons. In West
  328
  Germany, for instance, the position as regards retirement pension is that for people earning up to £1,300 a year there is a pension of between 50 and 55 per cent. of earnings and pensions are adjusted annually to take account of increases in wages and the cost of living. In Sweden, the level is as much as 55 per cent. of final salary up to quite a high limit. In France, there is a rather different system but, combining the various provisions made, the firm concludes that there is little scope or demand for private pension arrangements there. Belgium is even further ahead of us than the others. So one could go on.
  I do not want to overstate the point or be unfair—I admit that all sorts of complicated factors have to be taken into account—but, undoubtedly, this Government have presided—probably quite deliberately, for philosophical or ideological reasons—over a situation in which the State provision, the provision which we make for ourselves collectively as a community, has been allowed to fall behind that which our fellow citizens in Europe are making for themselves.
  It is not an unfair summary to say that the twelve-years' record of the Government, which the Minister claimed as a creditable achievement, is that, despite increases in particular benefits from time to time and despite large increases in contributions from time to time, the position of the insured has worsened over the period, the nature of the scheme has fundamentally changed, and those relying on social benefits have failed to share in the general advance which has occurred in the country during that time.
  It is for this reason that we say that there is an outstanding need to tackle our social insurance provisions afresh and in a radical way. Here, I believe, there is a great clash between the two sides of the House which we ought to admit and have out in the open. The approach of right hon. and hon. Members opposite is very much that which the right hon. Member for Enfield, West (Mr. Iain Macleod), in happier party days, indicated in a speech at the Conservative Party conference at Blackpool, a speech for which he was thanked by the chairman who described it as "that

  329
  magnificent and inspiring opening to our debate". In that speech he set out, I thought very clearly—it has been quoted already today—his view that we have accepted the present structure of social services too easily. In his words, change was the ally of his party. However, he thought that members of the party opposite should ask themselves a fundamental question, which was: should the wall of social security be the same height for everyone, and does the Beveridge approach make sense? He ended by saying:
  "I sense a feeling in this conference that we may be doing less than we ought to do for those with special needs and special problems because we insist on providing a flat level of benefits for everybody."
  What he was leading to was an attitude of mind, which appeared in a Bow Group document as well, that if we concentrated simply on those we selected as being specially needy and had a rather low level of benefit for the general run of beneficiaries, we would be able to do something for the specially needy, and do it rather less expensively; to put it in the vernacular, it would not break the bank.
  This is the approach of the party opposite. This is what it wants to do. It wants to get away from what it calls "the Beveridge approach" and the idea of subsistence benefits for everybody at an adequate level as of right earned by contributions shared by the insured, the employer and the State. It wants to get into a situation in which there is a minimum provision of that kind but in which we really rely on a very large proportion of the beneficiaries falling through that into the safety net of National Assistance. We do not accept that. That is not our concept of the way that a civilised society should approach the problems of those who are in need of social benefits in the year 1963.
  I think that the second difference between us is that, in addition to that approach to what the State provision ought to be, the party opposite has a fixed view that we should encourage the ordinary person to rely very much more on private enterprise insurance provision for a large part of his needs. Hon. Members opposite put this forward as a very desirable and, somehow,
  330
  rather bettor thing than if we do it collectively as citizens. I do not accept this on behalf of this party either. One fact never referred to by hon. Members opposite is that it costs the general taxpayer more to subsidise these so-called private enterprise arrangements than it would cost us to do it ourselves. In fact, we are providing rather more at this moment by way of tax rebates on the schemes for retirement pensioners than we are pulling into the flat-rate retirement pensions.
  The Minister gave the whole game away this afternoon. One of my hon. Friends asked him about the private schemes aid some of the objections to which they were open. The Minister said that the employer would not do it unless he, the employer, thought that it was in tie employee's interests. That is a delightfully old-fashioned approach in a democratic age, but the fact that the decision about contracting out is an employer's decision and not the decision of the individual insured is the answer to the Minister's claim that people would prefer it round that way. They are not allowed to prefer it round that way. The scheme does not operate in that way.
  In our view, we should return to three basic principles. In the first place, there should be National Insurance benefits capable themselves of meeting the subsistence needs of the insured people. Secondly, the National Assistance Board should perform the function of a little-used safety net for those with special needs and problems. Thirdly, there should be a fair sharing of the cost of the scheme between the three parties.
  There has been a lot of talk by the Prime Minister about various challenges on which le will meet us when we get to the hustings—for example, nationalisation and defence. I am not clear whether they are both as strong runners in his mini as once they were. Why does he not make pensions a challenge, take the difference of philosophy and ideological approach on this issue and let the people decide on it? I should be happy to accept if challenged. The Prime Minister would find it a rather rewarding challenge for himself. [Interruption.] Rewards can be other than material. The Prime Minister's reward

  331
  would be a broadening of his understanding and a rather higher appreciation of what people are thinking. I was certainly not thinking of material reward.
  Before turning to our plan, let me look at today's announcement, which the Prime Minister came here to make before the debate. This is another piecemeal improvement, minor but very welcome, and none of us will criticise that in any way. It is very late, it comes a long while after we have been pressing for it, but better late than never. Repentance just before a General Election is repentance nevertheless, and I am a good enough Christian to welcome it whenever it comes.
  The announcement, however, has two major defects which the Prime Minister did not seem to understand. The first is that we should get rid of the earnings rule altogether for widows. There does not seem to be any great case for not doing so. I was not persuaded by the Minister that he had any great case for simply raising the limit from £6 to £7.
  The second defect, and a majorone, concerns the 10s. widow, of whom, clearly, the Prime Minister had never heard. She obviously did not exist in Kinross. I have never seen a more pathetic look of bewilderment on the Prime Minister's face than when he turned to his right hon. Friend the Minister to find out who she was. The 10s. widow, of whom there are a very large number, ought now to be receiving something like 30s. not merely to have the 10s. It is a great pity that if the Government were making these other ad hoc piecemeal improvements for widows, this one was not done.
  I turn for a moment to our plan. It has been published in detail and unless people are wilfully blind, there is no difficulty even in anybody on the benches opposite understanding it. We have, however, just brought out a simplified version—[Laughter.]—simplified in the sense of trying to get it down to basic English, and as the great need on the benches opposite is for basic English, nobody on that side of the House should take exception to it.
  The aim of our scheme is fourfold. The first is to provide adequate benefits
  332
  as of right into the future for those who retire, those who are unemployed and those who go sick. The second is to establish an existing basic rate which, together with a graded element benefit related to wages, will provide adequate benefit related to a person's standard of living and, therefore, a cushion against any real drop in his standards. The third aim is to establish wage-related contributions to that we can finance a new scheme of this kind, and the fourth is to deal with the problem of the existing pensioners, the existing widows and those who will retire in the period of transition. Hon. Members opposite concentrated on the fourth case, but that is a case one gets in any transition from an existing scheme to a new scheme, and the income guarantee applies there. For the future, however, if we can establish our plan, we will no longer have that problem because everyone's benefits will be related to earnings.
  When people ask what the benefit will be, our reply is that those on average earnings, as shown in the Ministry of Labour index, will receive about half their earnings; those with lower than the average will receive a benefit probably higher than their earnings; those with above-average earnings will receive a benefit lower than half their earnings. The insured person on average earnings will pay a contribution of about the same as now; those on less than average earnings will pay a contribution lower than now; but many of us who have above-average earnings will pay a contribution considerably more than now.
  For the employer there will be a higher contribution than he now pays, but it will be less than most of his competitors in Europe pay. The benefits will provide this relationship to earnings both for long-term retirement beneficiaries and in short-term sickness and unemployment cases. Widows will be provided for similarly.
  The problem of income guarantee has excited the most attention opposite. Let me make this plain. What we are trying to do is to provide a guaranteed basic rate which can be made available through some form of automatic supplementation, worked out on the receipt of the income

  333
  return which we all make. In that sense there will be no means test in the way it is generally understood now. No one will have to confess or prove poverty in order to get supplementation. Everyone will do the same thing—make a return of income—as we do now, and will either pay Income Tax accordingly or receive supplementation accordingly if income is below a certain level.
  Here again, it would certainly involve a basic rate substantially higher than that paid at the beginning. Over the transitional period, it will go up by increments to a rate considerably higher than the basic rate as it now applies.
  We are asked why we do not give the exact figures. The answer is a very clear one, although it may not be politically acceptable to the hon. Members opposite and not convenient to them. I understand that as a politician. But any specific figures, other than the general proportions and the relationships which will apply at some period after the election which is to take place on a date and in circumstances which we do not yet know, would have to be hypothetical. The Government do not attach themselves to figures about future situations. They do as we are doing—attach themselves to relationships, proportions and examples.
  I believe that the people outside understand our answer. [Interruption] I point out to hon. Members opposite that, in every test in these last few years, the people outside have shown that they understand. That is an inescapable fact, and if the Government want to test their view that we are wrong about this and believe that they have a winner, the Prime Minister has the answer in his own hands—he can go to the country and put the case to the people.
  9.30 p.m.
  The Chief Secretary to the Treasury and Paymaster-General (Mr. John Boyd-Carpenter): As the right hon. Member for Belper (Mr. G. Brown) said, we have had an interesting debate, and not the least interesting part of it was his own contribution. However, there is one oddity about what at other moments has seemed more or less like the routine and standard debates on this subject to which the House is very accustomed. That is its timing.
  334
  Previous debates—and I have taken part in many of them—have not taken place, as this has, against a background of very recent and very substantial increases in benefits. They have generally been arranged at another time, when increases which had recently been put into effect might have begun to fade from people's memories. But this debate comes—and this is the peculiar thing—against the background of—[Hon. Members: "The General Election."] I do not know whether hon. Members opposite are putting that interpretation on the motive of their right hon. Friends in choosing this subject. I am saying that the debate comes against a background, which must dominate it, of the resent massive increase in National Insurance benefits which was brought into effect early this year.
  The right hon. Gentleman said that we were not concerned in this debate with improvements over the past improvements in standards. Then, a little inconsistenty, he went on to attack us on the grounds, he said, that we had allowed the standards to fall. The right non. Gentleman cannot have it both ways. If it is his argument that we have allowed standards to fall—I think that his words were that the position of the insured had declined—then he must accept that it is highly material to see what in truth and in fact has happened over these 12 years and what as a matter of ascertain able fact the changes have been.
  We start with the recent increase in National Insurance benefits, which has had the effect of raising those benefits in real terms to the highest level which they have ever reached, to levels for the standard rare of benefits of between 50 and 55 per cent. in real terms above those prevailing at the time this Government took office.
  The interesting thing is that these increases have not, in any measure whatever, been eroded. The increase in retirement benefits—the short-term benefits came into effect a little earlier—operated from 27th May. Since that date, there has been no fall in their value. It deed, the Index of Retail Prices, so far from having risen, has marginally fallen and, therefore, the value of these benefits, already at the

  335
  highest level ever, has been fully maintained. This attack is launched against a background of an increase, not much more than six months ago, to the highest level yet reached, a level which has been fully maintained up to today. Therefore, we naturally particularly welcome the debate.
  The right hon. Gentleman went on to make certain comparisons, which he alleged were to our disfavour, with the nations of Western Europe. I am sure that he appreciates how fallacious such comparisons are. Several of the countries that he mentioned do not even maintain a National Health Service, which we maintain at a current cost of £1,000 million a year. Therefore, simply to take one section of social security and to make a purely limited comparison without taking into account the whole sweep of our social measures is plainly unfair to this country.
  Even within the narrow scope which the right hon. Gentleman selected, that of social scurity benefits, a fact which he does not appear to appreciate is that in these years we have devoted an increasing proportion of our increasing national income to this very purpose. When the right hon. Gentlemen left office, 2·3 per cent. of our national income was spent on retirement pensions. Last year the figure was 3·6 per cent., and this year it is undoubtedly higher. Or, taking National Insurance benefits as a whole, when the Labour Party left office it was 3·5 per cent., and it is now 5·4 per cent.
  If the right hon. Gentleman wants a contrast, he can have it. In 1949, the first year that the National Insurance Scheme came into full operation, 2·5 per cent. of the national income was spent on retirement pensions. Over the remaining two years of the right hon. Gentleman's administration it fell to 2·3 per cent. in 1951. It therefore does not lie in their mouths to accuse us of having allowed the position of the insured to deteriorate.
  Consider actual expenditure. In 1951, £270 million was spent on retirement pensions. Last year the figure was £821 million, and this year it is almost certainly £100 million more. On all National Insurance benefits the figure rose from £407 million to £1,218 million,
  336
  a large increase in real terms and a substantial increase in the share of our national income given to this purpose.
  As my hon. Friend the Member for Birmingham, Edgbaston (Dame Edith Pitt) said, we are proud of our record in this matter, and delighted to have the chance to deploy it. Our 1959 election manifesto said:
  "We pledge ourselves to ensure that pensioners continue to share in the good things which a steadily expanding economy will bring"
  and on the facts that is exactly what we have done, and done since 1951.
  The hon. and learned Member for Kettering (Mr. Mitchison) said that earnings had moved upwards faster than benefits. That is wrong. Since 1951 average male earnings have risen 95 per cent., the married rate of retirement pension by 118 per cent., and the single rate by 125 per cent.
  Mr. Mitchison: The right hon. Gentleman is right. I ought to have referred, as I intended to do, to National Assistance benefits and not to National Insurance ones.
  Mr. Boyd-Carpenter: The hon. and learned Gentleman therefore accepts that National Insurance benefits have risen by a greater proportion than earnings. He takes another point about National Assistance, but it does not seem to square with his point that we are driving people on to National Assistance.
  Two or three hon. Members said that benefits should rise in line with earnings. I can only say that if since 1951 they had risen only in line with earnings, the single rate would be 9s., and the married rate 11s. 8d., less than they are today.
  We have fully redeemed our 1959 pledge which I read to the House. Since then average men's earnings have increased by 16·9 per cent. The married rate of retirement pension has increased by 36·3 per cent., and the single rate by 35 per cent. Right hon. Gentlemen opposite can take whatever comparison they like, whether it is with consumer spending, or with the movement in prices. The fact remains that that pledge has not only been fully carried out, but, as the figures make clear, in many cases has been carried out twice over.

  337
  Here I must quarrel with several things that the right hon. Gentleman and the hon. and learned Member for Kettering said. They both referred to the fact that in our Amendment we suggested that special regard should be given to those whose need is greatest. The hon. and learned Member called it the relief approach. There I take my stand. I believe, with my right hon. Friends, that within the whole scope of National Insurance it is sound social policy and sound sense to give disproportionately large increases in the general directions in which the plain human need is greatest. That is the policy that we have pursued.
  The widowed mother is the example to which I should like to draw the House's attention, because we have as a matter of deliberate social policy improved her benefits quite disproportionately to the general level. I would remind the House that the real level of the retirement pension and the general standard rate of benefit is today 50 per cent. and 55 per cent., in respect of married and single persons respectively, above the 1951 level. But, taking the widowed mother,.the development is even greater.
  Let us take the normal example of a widowed mother with three children. In October, 1951, her benefit was 55s. a week in all. For a fair comparison we must allow for the changed value of money, and the equivalent today would be 79s. 9d. a week. The actual rates today, before my right hon. Friend's announcement, was 159s. 6d. a week—an increase, in real terms, of 79s, 9d. a week, or exactly 100 per cent. It is on that foundation, of a deliberate and special regard for the position of the widowed mother, that my right hon. Friend's announcement for further pro gress is to be based.
  The hon. Member for Stoke-on-Trent, North (Mrs. Slater) asked when it will come into effect. As the House knows, the matters to which my right hon. Friend referred will require legislation. We shall endeavour to introduce that legislation, subject to the wishes of the House, as speedily as we can, and my right hon. Friend will bring it into effect as soon as possible after that.
  At Question Time, in questioning my right hon. Friend the Prime Minister, the right hon. Member for Easington
  338
  (Mr. Shinwell) referred to the position of the unemployed. I do not know whether he is in his place now, but I should like him to know that I fully share the feelings that all hon. Members feel about the evil and frustration of unemployment. But it is at least a fact—and this was the point that he was on at Question Time today—that the unemployed man and his wife now face that tragedy at least with a 50per cent, better unemployment benefit, in real terms, than in the days when the right hon. Gentleman was responsible.
  We have heard a little this afternoon about the latest Labour Party scheme—what one newspaper called Crossman Mark IV. As several of my hon. Friends have pointed out, this is the one with no figures in it. I thought that the right hon. Member for Belper was a little more ingenuous than usual when he sought to explain that absence. The right hon. Gentleman and the House must face tie fact that the benefits proposed in the scheme sound generous—perhaps even lavish—and attractive. But how can any elector or citizen form a fair judgment of the desirability or otherwise of the plan unless he has the figures telling him what he will have to pay as a contributor, what he will have to pay as a taxpayer, and what his employer will have to pay? The right hon. Gentleman and several other hon. Members—including the hon. Member for Orpington (Mr. Lubbock), in particular—were rather lighthearted about piling additional burdens on employers.
  It is not good enough to say, as the right hon. Gentleman said, that the bur den that they contemplate would be less than that in certain Western European countries, because that is to fall into precisely the same error of isolation as the right hon. Gentleman fell into a few minutes ago. Unless one takes the whole picture, the taxation paid by our employers and those in Europe, the local rates paid now in respect of industry in full—
  Mr. Archie Manuel: And the rents paid.
  Mr. Boyd-Carpenter: —and the rents, if hon. Members wish, and the level of wages. Unless we take the whole picture, it does not make sense to say that in an intensely competitive world it is quite easy to pile additional burdens on

  339
  the employers—burdens which must be translated immediately into increased costs.
  It is even more irresponsible to do so when one does not give the figures. The hon. Member for Coventry, East (Mr. Crossman) gave a new and ingenious explanation—it was different from that of the right hon. Member for Belper, and, as one would expect, much more shrewd—of the absence of the figures. The hon. Gentleman said, "I do not know what the National Assistance rate will be when the time comes to apply it." That is an arguable view. But of course this is not the explanation which the hon. Gentleman himself gave at his Press conference when he introduced the scheme. To quote The Times of 2nd April:
  "Here Mr. Crossman gave the game away at the Transport House Press Conference yesterday when he said that last time the Labour Party had provided a model—with their National Superannuation plan—it had been 'shot to pieces' and they were not going to let that happen again."
  Mr. Crossman: I am sure that the Minister would like to add—he is a fair man—that I wrote to The Times the next day—they published the letter—pointing out that this was a completely unfair quotation which did not quote what I said at all.
  Hon. Members: Withdraw.
  Mr. Boyd-Carpenter: Of course, if the hon. Gentleman says that he did not use those words, I accept that—
  Mr. Crossman: I not only say it now, it was published in The Times the next day, and the right hon. Gentleman knew that perfectly well.
  Hon. Members: Withdraw.
  Mr. Boyd-Carpenter: Of course—[HON. MEMBERS: "Cheat."]—I accept what the hon. Gentleman says and he, I am sure, equally will accept what I say now—that I have not seen that letter and knew nothing of it—[HON. MEMBERS: "Oh."]—but the fact remains—
  Mr. Crossman: What are the gentlemen in the officials' box for but to brief the Minister adequately?
  Sir W. Bromley-Davenport: Sit down.
  Hon. Members: Withdraw.
  Mr. Boyd-Carpenter: I am not the sort of person—as the hon. Gentleman knows—[Hon. Members: "Apologise."]—to blame officials or anybody else. I quoted in good faith from a copy of The Times newspaper which I had. All I can do is to tell the hon. Gentleman that, of course, I accept his statement, and equally I ask him to accept from me—because it is the truth—that I was totally unaware of the letter.
  What is important is that plainly there would be heavy contributions under this scheme—[Interruption.]—What I must ask the House to accept is the danger of imposing upon our industry at this moment heavy additional burdens. I must again stress that to ask people to accept this scheme, the cost of which we are not told, the cost of which for one reason or another is withheld, is not a proper method of asking the people of this country to deal with a serious issue. I comment that it was not the method which the hon. Member himself used in the earlier editions of his plan—[Hon. Members: "Apologise."]
  I come to the income guarantee, or receive-as-you-need proposal, of which a great deal has been said in this House this evening. The proposal, as I understand it, is that an income should be guaranteed at a particular figure worked out by means of the Income Tax return, the idea being to give help where it is most needed without the alleged stigma of National Assistance. That attempts to get the best of both worlds and I shall suggest to the House a number of reasons why it fails to do so.
  First, when one allows for the present high allowance of Income Tax we should remember that a considerable number of old people are not paying Income Tax. There are some millions, I believe, who do not at present make Income Tax returns at all. To operate this scheme it would be necessary to make several million people who do not at present pay Income Tax fill in an Income Tax return, including a number of old widows who have never filled in an Income Tax return in their lives.
  There are more serious difficulties than that. Those who now do make an Income Tax return do so once a year. I ask the House to consider whether it is a good method of deciding how to help

  341
  people by uncovenanted additions to their pensions if they are to be based on a return made at the beginning of the year. There is no provision whatever in such a scheme for all the changes which can come to people, particularly old people, in the course of a year—illness, death of a breadwinner and so on.
  More important, it relates to only one side of the problem. It relates to income; it does not relate to need. [Interruption.] I ask the House to consider this example. There can be two people with the same taxable income [Interruption.]—
  Mr. H. A. Price: On a point of order. Owing to the unruly hubbub on the benches opposite, it is impossible to hear what is being said.
  Mr. Speaker: That point of order, so far as I heard it, coincides with my view that it would be a good idea if the House made a little less noise.
  Mr. Boyd-Carpenter: The point I was putting to the House is the difficulty of judging the needs of a person on income alone, which is the only thing which the Income Tax return will give. One can take the case of two people, one a retired pensioner with a plentiful stock of clothes living with younger relatives in a comfortable home. The other is the old lady living by herself with her stock of clothes exhausted and paying a high rent. Under a scheme turning on the Income Tax return, it is not possible, as I understand it, to distinguish between the two, because only income, not needs, is taken into account. That is a very serious defect in a scheme based upon Income Tax.
  The right hon. Member for Huyton (Mr. H. Wilson) referred earlier to the 10s. widow. [Interruption.]
  Mr. Speaker: Order. It is not in accordance with our practice to persist in noisy conversation. I hope that the House will desist from it.
  Mr. Boyd-Carpenter: The right hon. Member for Huyton, who is not now in his place, suggested that the pension of the 10s. widow should be increased. I am not sure that the right hon. Gentleman knows who the 10s. widow is. She is a lady who has a benefit under the old
  342
  Insurance Acts but who does not qualify under the new scheme because she is neither over 50 nor the mother of young children. The House must recollect that in I946 the Labour Party passed an Act which put provision for widowhood on a selective basis. All that the 10s. widow is is a lady who under the present Act would not qualify for pension at all. Therefore, to do what the right hon. Member for Huyton apparently suggested is to increase the disparity which exists between the 10s. widow and what I may call the no-shilling willow, the widow who under the present scheme does not receive benefit at all.
  I cannot see the justification, nor could the Labour Party itself a few years ago, of providing for this lady when ladies under the present scheme receive in similar domestic circumstances no pension provision. Right hon. Members opposite adopted this line themselves. When they made their improvements in 1951 they did not touch the 10s. widow, though the real value of her pension had by then fallen to 7s. 4d. Mr. Marquand, a former Member for Middlesbrough, speaking for the Opposition only a few years ago, told the House that these ladies had not a real grievance, though they thought they had.
  The hon. Member for Bedwellty (Mr. Finch) dealt with certain aspects of the industrial injuries scheme, as I have heard him do many times before. Obviously my right hon. Friend will take note of what he said. The hon. Gentleman's argument that the war pensions scheme makes more generous provision is one that it is not particularly easy to accept. All Governments, including that of right hon. Members opposite as well as our own, have taken the view over the years that the war pensioner, the person disabled in service of his country, is entitled to priority in our social service system. That is a principle to which some of us on this side of the House attach very great importance indeed.
  We are proud of our record as a party in social security. The facts speak for themselves, that we have improved the condition of those who depend on social benefits to a greater extent than they have ever been improved before. Today the real value of these benefits stands higher than it ever did before. The right

  343
  hon. Member for Belper concluded his speech by throwing out a challenge to my right hon. Friend the Prime Minister. I took a note of it. He suggested that we should contest the issue on pensions on ideologies and policies. I note that he did not interpose into that challenge the challenge of performance. On the question of performance—
  Mr. Herbert W. Bowden rose in his place and claimed to move, That the Question be now put.
  Question, That the Question be now put, put and agreed to.
  Question put accordingly, That the words proposed to be left out stand part of the Question: —
  The House divided: Ayes 226, Noes 298.

  Division No. 5.]

  AYES

  [10.0 p.m.

  Abse, Leo

  Griffiths, Rt. Hon. James (Llanelly)

  Mayhew, Christopher

  Albu, Austen

  Griffiths, W. (Exchange)

  Mellish, R. J.

  Allaun, Frank (Satford, E.)

  Grimond, Rt. Hon. J.

  Mendelson, J. J.

  Allen, Scholefield (Crewe)

  Gunter, Ray

  Millan, Bruce

  Awbery, Stan (Bristol, Central)

  Hamilton, William (West Fife)

  Milne, Edward

  Bacon, Miss Alice

  Hannan, William

  Mitchison, G. R.

  Baird, John

  Harper, Joseph

  Monslow, Walter

  Barnett, Guy

  Hayman, F. H.

  Moody, A. S.

  Baxter, William (Stirlingshire, W.)

  Healey, Denis

  Morris, Charles (Openshaw)

  Beaney, Alan

  Henderson,Rt.Hn.Arthur(RwlyRegis)

  Morris, John

  Bellenger, Rt. Hon. F. J.

  Herbison, Miss Margaret

  Moyle, Arthur

  Benn, Anthony Wedgwood

  Hewitson, Capt. M.

  Mulley, Frederick

  Benson, Sir George

  Hilton, A. V.

  Neal, Harold

  Blackburn, F.

  Holman, Percy

  Noel-Baker, Francis (Swindon)

  Blyton, William

  Holt, Arthur

  Noel-Baker,Rt.Hn.Philip(Derby,S.)

  Boardman, H.

  Houghton, Douglas

  Oliver, G. H.

  Bowden, Rt. Hn. H. W. (Leics,S.W.)

  Howell, Charles A. (Perry Barr)

  O'Malley, B. K.

  Bowen, Roderic (Cardigan)

  Howell, Denis (Small Heath)

  Oram, A. E.

  Bowles, Frank

  Howie, W. (Luton)

  Oswald, Thomas

  Boyden, James

  Hoy, James H.

  Owen, Will

  Braddock, Mrs. E. M.

  Hughes, Cledwyn (Anglesey)

  Padley, W. E.

  Bradley, Tom

  Hughes, Emrys (S. Ayrshire)

  Paget, R. T.

  Bray, Dr. Jeremy

  Hughes, Hector (Aberdeen, N.)

  Pannell, Charles (Leeds, W.)

  Brown, Rt. Hon. George (Belper)

  Hunter, A. E.

  Pargiter, G. A.

  Butler, Herbert (Hackney, C.)

  Hynd, H. (Accrington)

  Parker, John

  Butler, Mrs. Joyce (Wood Green)

  Irvine, A. J. (Edge Hill)

  Parkin, B. T.

  Callaghan, James

  Irving, Sydney (Dartford)

  Paton, John

  Carmichael, Neil

  Janner, Sir Barnett

  Pavitt, Laurence

  Chapman, Donald

  Jay, Rt. Hon. Douglas

  Pearson, Arthur (Pontypridd)

  Cliffe, Michael

  Jeger, George

  Peart, Frederick

  Collick, Percy

  Jenkins, Roy (Stechford)

  Pentland, Norman

  Corbet, Mrs. Freda

  Johnson, Carol (Lewisham, S.)

  Popplewell, Ernest

  Craddock, George (Bradford, S.)

  Jones,Rt.Hn. A. Creech(Wakefield)

  Prentice, R. E.

  Cronin, John

  Jones, Dan (Burnley)

  Probert, Arthur

  Crosland, Anthony

  Jones, J. Idwal (Wrexham)

  Proctor, W. T.

  Crossman, R. H. S.

  Jones, T. W. (Merioneth)

  Pursey, Cmdr. Harry

  Cullen, Mrs. Alice

  Kelley, Richard

  Randall, Harry

  Dalyell, Tam

  Kenyon, Clifford

  Rankin, John

  Darling, George

  Key, Rt. Hon. C. W.

  Rees, Merlyn (Leeds, S.)

  Davies, G. Elfed (Rhondda, E.)

  King, Dr. Horace

  Reid, William

  Davies, Harold (Leek)

  Lawson, George

  Reynolds, G. W.

  Davies, Ifor (Gower)

  Ledger, Ron

  Rhodes, H.

  Deer, George

  Lee, Frederick (Newton)

  Roberts, Albert (Normanton)

  Delargy, Hugh

  Lee, Miss Jennie (Cannock)

  Roberts, Goronwy (Caernarvon)

  Dempsey, James

  Lever, L. M. (Ardwick)

  Robinson, Kenneth (St. Pancras, N.)

  Diamond, John

  Lewis, Arthur (West Ham, N.)

  Rodgers, W. T. (Stockton)

  Dodds, Norman

  Lipton, Marcus

  Shinwell, Rt. Hon. E.

  Doig, Peter

  Loughlin, Charles

  Silkin, John

  Donnelly, Desmond

  Lubbock, Eric

  Silverman, Julius (Aston)

  Driberg, Tom

  Mabon, Dr. J. Dickson

  Silverman, Sydney (Nelson)

  Duffy, A. E. P. (Colne Valley)

  McBride, N.

  Skeffington, Arthur

  Edelman, Maurice

  MacColl, James

  Slater, Mrs. Harriet (Stoke, N.)

  Edwards, Rt. Hon. Ness (Caerphilly)

  MacDermot, Niall

  Slater, Joseph (Sedgefield)

  Edwards, Robert (Bilston)

  McInnes, James

  Small, William

  Edwards, Walter (Stepney)

  McKay, John (Wallsend)

  Smith, Ellis (Stoke, S.)

  Evans, Albert

  McLeavy, Frank

  Snow, Julian

  Fernyhough, E.

  MacMillan, Malcolm (Western Isles)

  Sorensen, R. W.

  Finch, Harold

  MacPherson, Malcolm (Stirling)

  Spriggs, Leslie

  Fitch, Alan

  Mahon, Simon

  Steele, Thomas

  Fletcher, Eric

  Mallalieu, E. L. (Brigg)

  Stewart, Michael (Fulham)

  Forman, J. C.

  Mallalieu,J.P.W.(Huddersfield, E.)

  Stonehouse, John

  Galpern, Sir Myer

  Manuel, Archie

  Stones, William

  George,LadyMeganLloyd(Crmrthn)

  Mapp, Charles

  Strauss, Rt. Hn. G. R. (Vauxhall)

  Ginsburg, David

  Marsh, Richard

  Stross,Dr.Barnett(Stoke-on-Trent,C.)

  Grey, Charles

  Mason, Roy

  Swain, Thomas

  Griffiths, David (Rother Valley)

  Swingler, Stephen

  Symonds, J. B.

  Warbey, William

  Wilson, Rt. Hon. Harold (Huyton)

  Taverne, D.

  Watkins, Tudor

  Winterbottom, R. E.

  Taylor, Bernard (Mansfield)

  Weitzman, David

  Woodburn, Rt. Hon. A.

  Thomas, George (Cardiff, W.)

  Wells, William (Walsall, N.)

  Woof, Robert

  Thomas, Iorwerth (Rhondda, W.)

  White, Mrs. Eirene

  Wyatt, Woodrow

  Thompson, Dr. Alan (Dunfermline)

  Whitlock, William

  Yates, Victor (Ladywood)

  Thomson, G. M. (Dundee, E.)

  Wigg, George

  Zilliacus, K.

  Thornton, Ernest

  Wilkins, W. A.

  Thorpe, Jeremy

  Willey, Frederick

  TELLERS FOR THE AYES:

  Tomney, Frank

  Williams, D. J. (Neath)

  Mr. G. H. R. Rogers and

  Wainwright, Edwin

  Williams, W. T. (Warrington)

  Mr. Redhead.

  NOES

  Agnew, Sir Peter

  Duncan, Sir James

  Jones, Arthur (Northants, S.)

  Aitken, Sir William

  Duthie, Sir William (Banff)

  Jones, Rt. Hn. Aubrey (Hall Green)

  Allan, Robert (Paddington, S.)

  Eden, Sir John

  Kerans, Cdr. J. S.

  Allason, James

  Elliot, Capt. Walter (Carshalton)

  Kerby, Capt. Henry

  Amery, Rt. Hon. Julian

  Elliott,R.W.(Newc'tle-upon-Tyne,N.)

  Kerr, Sir Hamilton

  Atkins, Humphrey

  Emery, Peter

  Kershaw, Anthony

  Awdry, Daniel (Chippenham)

  Emmet, Hon. Mrs. Evelyn

  Kimball, Marcus

  Balniel, Lord

  Errington, Sir Eric

  Kirk, Peter

  Barber, Rt. Hon. Anthony

  Erroll, Rt. Hon. F. J.

  Kitson, Timothy

  Barlow, Sir John

  Farey-Jones, F. W.

  Lagden, Godfrey

  Barter, John

  Farr, John

  Lambton, Viscount

  Batsford, Brian

  Fell, Anthony

  Leather, Sir Edwin

  Beamish, Col. Sir Tufton

  Fisher, Nigel

  Leavey, J. A.

  Bell, Ronald

  Fletcher-Cooke, Charles

  Legge-Bourke, Sir Harry

  Bennett, F. M. (Torquay)

  Forrest, George

  Lewis, Kenneth (Rutland)

  Bennett, Dr. Reginald (Gos & Fhm)

  Fraser, Ian (Plymouth, Sutton)

  Lilley, F. J. P.

  Berkeley, Humphry

  Gammans, Lady

  Linstead, Sir Hugh

  Biffen, John

  Gardner, Edward

  Litchfield, Capt. John

  Biggs-Davison, John

  Gibson-Watt, David

  Lloyd,Rt.Hn.Geoffrey(Sut'nC'dfield)

  Bingham, R. M.

  Gilmour, Ian (Norfolk, Central)

  Lloyd, Rt. Hon. Selwyn (Wirral)

  Birch, Rt. Hon. Nigel

  Gilmour, Sir John (East Fife)

  Longdon, Gilbert

  Bishop, F. P.

  Glyn, Dr. Alan (Clapham)

  Loveys, Walter H.

  Black, Sir Cyril

  Glyn, Sir Richard (Dorset, N.)

  Lucas, Sir Jocelyn

  Bossom, Hon. Clive

  Godber, Rt. Hon. J. B.

  Lucas-Tooth, Sir Hugh

  Bourne-Arton, A.

  Goodhew, Victor

  McAdden, Sir Stephen

  Boyd-Carpenter, Rt. Hon. John

  Gough, Frederick

  MacArthur, Ian

  Boyle, Rt. Hon. Sir Edward

  Gower, Raymond

  McLaren, Martin

  Braine, Bernard

  Grant-Ferris, R.

  McLaughlin, Mrs. Patricia

  Bromley-Davenport,Lt.-Col.Sir Walter

  Green, Alan

  Maclay, Rt. Hon. John

  Brooke, Rt. Hon. Henry

  Gresham Cooke, R.

  Maclean,SirFitzroy(Bute&N.Ayrs)

  Brown, Alan (Tottenham)

  Grosvenor, Lord Robert

  Macleod, Rt. Hn. Iain (Enfield, W.)

  Browne, Percy (Torrington)

  Gurden, Harold

  MacLeod, Sir J (Ross & Cromarty)

  Bryan, Paul

  Hall, John (Wycombe)

  McMaster, Stanley R.

  Buck, Antony

  Hamilton, Michael (Wellingborough)

  Macmillan, Maurice (Halifax)

  Bullard, Denys

  Harris, Reader (Heston)

  Maddan, Martin

  Bullus, Wing Commander Eric

  Harrison, Brian (Maldon)

  Maginnis, John E.

  Burden, F. A.

  Harvey, John (Walthamstow, E.)

  Maitland, Sir John

  Butcher, Sir Herbert

  Harvie Anderson, Miss

  Markham, Major Sir Frank

  Campbell, Gordon (Moray & Nairn)

  Hay, John

  Marlowe, Anthony

  Carr, Compton (Barons Court)

  Heald, Rt. Hon. Sir Lionel

  Marples, nt. Hon. Ernest

  Carr, Rt. Hon. Robert (Mitcham)

  Henderson, John (Cathcart)

  Marten, Neil

  Cary, Sir Robert

  Hicks Beach, Maj. W.

  Matthews, Gordon (Meriden)

  Channon, H. P. G.

  Hiley, Joseph

  Maudling, Rt. Hon. Reginald

  Chataway, Christopher

  Hill, Mrs. Eveline (Wythenshawe)

  Mawby, Ray

  Clark, Henry (Antrim, N.)

  Hill, J. E. B. (S. Norfolk)

  Maxwell-Hyslop, R. J.

  Clark, William (Nottingham, S.)

  Hirst, Geoffrey

  Maydon, Lt.-Cmdr. S. L. C.

  Cleaver, Leonard

  Hobson, Rt. Hon. Sir John

  Mills, Stratton

  Cole, Norman

  Hooking, Philip N.

  Miscampbell, Norman

  Cooks, Robert

  Hogg, Quintin

  Montgomery, Fergus

  Cooper, A. E.

  Holland, Philip

  More, Jasper (Ludlow)

  Cooper-Key, Sir Neill

  Hollingworth, John

  Morgan, William

  Cordeaux, Lt.-Col. J. K.

  Hopkins, Alan

  Morrison, John

  Corfield, F. V.

  Hornby, R. P.

  Mott-Radclyffe, Sir Charles

  Costain, A. P.

  Hornsby-Smith, Rt. Hon. Dame P.

  Nabarro, Sir Gerald

  Coulson, Michael

  Howard, Hon. G. R. (St. Ives)

  Neave, Airey

  Craddock, Sir Beresford (Spelthorne)

  Howard, John (Southampton, Test)

  Noble, Rt. Hon. Michael

  Crawley, Aldan

  Hughes Hallett, Vice-Admiral John

  Nugent, Rt. Hon. Sir Richard

  Critchley, Julian

  Hughes-Young, Michael

  Oakshott, Sir Hendrie

  Crowder, F. P.

  Hulbert, Sir Norman

  Orr, Capt. L. P. S.

  Cunningham, Sir Knox

  Hurd, Sir Anthony

  Orr-Ewling, Sir Ian (Hendon, North)

  Curran, Charles

  Hutchison, Michael Clark

  Osborn, John (Hallam)

  Dalkeith, Earl of

  Iremonger, T. L.

  Osborne, Sir Cyril (Louth)

  Dance, James

  Irvine, Bryant Godman (Rye)

  Page, Graham (Crosby)

  d'Avigdor-Goldsmid, Sir Henry

  Jackson, John

  Pannell, Norman (Kirkdale)

  Digby, Simon Wingfield

  James, David

  Partridge, E.

  Donaldson, Cmdr. C. E. M.

  Jenkins, Robert (Dulwich)

  Pearson, Frank (Clitheroe)

  Doughty, Charles

  Jennings, J. C.

  Peel, John

  Douglas-Home, Rt. Hon. Sir Alec

  Johnson, Dr. Donald (Carlisle)

  Percival, Ian

  Drayson, G. B.

  Johnson, Eric (Blackley)

  Peyton, John

  du Cann, Edward

  Johnson Smith, Geoffrey

  346

  347

  Pickthorn, Sir Kenneth

  Smith, Dudley (Br'ntf'd & Chiswick)

  Turner, Colin

  Pilkingon, Sir Richard

  Smithers, Peter

  van Straubenzee, W. R.

  Pitman, Sir James

  Smyth, Rt. Hon. Brig. Sir John

  Vane, W. M. F.

  Pitt, Dame Edith

  Soames, Rt. Hon. Christopher

  Vaughan-Morgan, Rt. Hon. Sir John

  Pott, Percivall

  Spearman, sir Alexander

  Vickers, Miss Joan

  Pounder, Rafton

  Speir, Rupert

  Vosper, Rt. Hon. Dennis

  Powell, Rt. Hon. J. Enoch

  Stainton, Keith

  Walder, David

  Price, David (Eastleigh)

  Stanley, Hon. Richard

  Walker, Peter

  Price, H. A. (Lewisham, W.)

  Stevens, Geoffrey

  Walker-Smith, Rt. Hon. Sir Derek

  Prior-Palmer, Brig. Sir Otho

  Steward, Harold (Stockport, S.)

  Wall, Patrick

  Proudfoot, Wilfred

  Stodart, J. A.

  Ward, Dame Irene

  Pym Francis

  Stoddart-Scott, Col. Sir Malcolm

  Watkinson, Rt. Hon. Harold

  Rawlinson, Sir Peter

  Storey, Sir Samuel

  Webster, David

  Redmayne, Rt. Hon. Martin

  Studholme, Sir Henry

  Wells, John (Maidstone)

  Rees-Davies, W. R. (Isle of Thanet)

  Summers, Sir Spencer

  Whitelaw, William

  Renton, Rt. Hon. David

  Talbot, John E.

  Williams, Dudley (Exeter)

  Ridley, Hon. Nicholas

  Tapsell, Peter

  Williams, Paul (Sunderland, S.)

  Ridsdale, Julian

  Taylor, Sir Charles (Eastbourne)

  Wills, Sir Gerald (Bridgwater)

  Rippon, Rt. Hon. Geoffrey

  Taylor, Frank (M'ch'st'r, Moss Side)

  Wilson, Geoffrey (Truro)

  Roberts, Sir Peter (Heeley)

  Taylor, Sir William (Bradford, N.)

  Wise, A. R.

  Robinson, Rt. Hn. Sir R. (B'pool, S.)

  Teeling, Sir William

  Wolrige-Gordon, Patrick

  Robson Brown, Sir William

  Temple, John M.

  Wood, Rt. Hon. Richard

  Rodgers, John (Sevenoaks)

  Thatcher, Mrs. Margaret

  Woodhouse, C. M.

  Ropner, col. Sir Leonard

  Thomas, Sir Leslie (Canterbury)

  Woodnutt, Mark

  Russell, Ronald

  Thomas, Peter (Conway)

  Woollam, John

  Scott-Hopkins, James

  Thompson, Sir Kenneth (Walton)

  Worsley, Marcus

  Seymour, Leslie

  Thorneycroft, Rt. Hon. Peter

  Yates, William (The Wrekin)

  Sharples, Richard

  Thornton-Kemsley, Sir Colin

  Shaw, M.

  Tiley, Arthur (Bradford, W.)

  TELLERS FOR THE NOES:

  Shepherd, William

  Tilney, John (Wavertree)

  Mr. Chichester-Clark and Mr. Finlay.

  Skeet, T. H. H.

  Touche, Rt. Hon. Sir Gordon

  Question put, That the proposed words be there added: —
  The House divided: Ayes 298, Noes 223.

  Division No. 6.]

  AYES

  [10.14 p.m.

  Agnew, Sir Peter

  Clark, William (Nottingham, S.)

  Gilmour, Sir John (East Fife)

  Aitken, Sir William

  Cleaver, Leonard

  Glyn, Dr. Alan (Clapham)

  Allan, Robert (Paddington, S.)

  Cole, Norman

  Glyn, Sir Richard (Dorset, N.)

  Allason, James

  Cooke, Robert

  Godber, Rt. Hon. J. B.

  Amery, Rt. Hon. Julian

  Cooper, A. E.

  Goodhew, Victor

  Atkins, Humphrey

  Cooper-Key, Sir Neill

  Gough, Frederick

  Awdry, Daniel (Chippenham)

  Cordeaux, Lt.-Col. J. K.

  Gower, Raymond

  Balniel, Lord

  Corfield, F. V.

  Grant-Ferris, R.

  Barber, Rt. Hon. Anthony

  Costain, A. P.

  Green, Alan

  Barlow, Sir John

  Coulson, Michael

  Gresham Cooke, R.

  Barter, John

  Craddock, Sir Beresford (Spelthorne)

  Grosvenor, Lord Robert

  Batsford, Brian

  Crawley, Aldan

  Gurden, Harold

  Beamish, Col. Sir Tufton

  Critchley, Julian

  Hall, John (Wycombe)

  Bell, Ronald

  Crowder, F. P.

  Hamilton, Michael (Wellingborough)

  Bennett, F. M. (Torquay)

  Cunningham, Sir Knox

  Harris, Reader (Heston)

  Bennett, Dr. Reginald (Gos & Fhm)

  Curran, Charles

  Harrison, Brian (Maldon)

  Berkeley, Humphry

  Dalkeith, Earl of

  Harvey, John (Walthamstow, E.)

  Biffen, John

  Dance, James

  Harvie Anderson, Miss

  Biggs-Davison, John

  d'Avigdor-Goldsmid, Sir Henry

  Hay, John

  Bingham, R. M.

  Digby, Simon Wingfield

  Heald Rt. Hon. Sir Lionel

  Birch, Rt. Hon. Nigel

  Donaldson, Cmdr. C. E. M.

  Henderson, John (Cathcart)

  Bishop, F. P.

  Doughty, Charles

  Hicks Beach, Maj. W.

  Black, Sir Cyril

  Douglas-Home, Rt. Hon. Sir Alec

  Hiley, Joseph

  Bossom, Hon. Clive

  Drayson, G. B.

  Hill, Mrs. Eveline (Wythenshawe)

  Bourne-Arton, A.

  du Cann, Edward

  Hill, J. E. B. (S. Norfolk)

  Boyd-Carpenter, Rt. Hon. John

  Duncan, Sir James

  Hirst, Geoffrey

  Boyle, Rt. Hon. Sir Edward

  Duthie, Sir William (Banff)

  Hobson, Rt. Hon. Sir John

  Braine, Bernard

  Eden, Sir John

  Hocking, Philip N.

  Bromley-Davenport, Lt.-Col. SirWalter

  Elliot, Capt. Walter (Carshalton)

  Hogg, Quintin

  Brooke, Rt. Hon. Henry

  Elliott,R.W.(Newc'tle-upon-Tyne,N.)

  Holland, Philip

  Brown, Alan (Tottenham)

  Emery, Peter

  Hollingworth, John

  Browne, Percy (Torrington)

  Emmet, Hon. Mrs. Evelyn

  Hopkins, Alan

  Bryan, Paul

  Errington, Sir Eric

  Hornby, R. P.

  Buck, Antony

  Erroll, Rt. Hon. F. J,

  Hornsby-Smith, Rt. Hon. Dame P.

  Bullard, Denys

  Farey-Jones, F. W.

  Howard, Hon. G. R. (St. Ives)

  Bullus, Wing Commander Eric

  Farr, John

  Howard, John (Southampton, Test)

  Burden, F. A.

  Fell, Anthony

  Hughes Hallett, Vice-Admiral John

  Butcher, Sir Herbert

  Fisher, Nigel

  Hughes-Young, Michael

  Campbell, Gordon (Moray & Nairn)

  Fletcher-Cooke, Charles

  Hulbert, Sir Norman

  Carr, Compton (Barons Court)

  Forrest, George

  Hurd, Sir Anthony

  Carr, Rt. Hon. Robert (Mitcham)

  Fraser, Ian (Plymouth, Sutton)

  Hutchison, Michael Clark

  Cary, Sir Robert

  Gammans, Lady

  Iremonger, T. L.

  Channon, H. P. G.

  Gardner, Edward

  Irvine, Bryant Godman (Rye)

  Chataway, Christopher

  Gibson-Watt, David

  Jackson, John

  Clark, Henry (Antrim, N.)

  Gilmour, Ian (Norfolk, Central)

  James, David

  Jenkins, Robert (Dulwich)

  Morrison, John

  Stainton, Keith

  Jennings, J. C.

  Mott-Radclyffe, Sir Charles

  Stanley, Hon. Richard

  Johnson, Dr. Donald (Carlisle)

  Nabarro, Sir Gerald

  Stevens Geoffrey

  Johnson, Eric (Blackley)

  Neave, Airey

  Steward, Harold (Stockport, S.)

  Johnson Smith, Geoffrey

  Noble, Rt. Hon. Michael

  Stodart, J. A,

  Jones, Arthur (Northants, S.)

  Nugent, Rt. Hon. Sir Richard

  Stoddart-Scott, Col. Sir Malcolm

  Jones, Rt. Hn. Aubrey (Hall Green)

  Oakshott, Sir Hendrie

  Storey, Sir Samuel

  Kerans, Cdr. J. S.

  Orr, Capt. L. P. S.

  Studholme, Sir Henry

  Kerby, Capt. Henry

  Orr-Ewing, Sir Ian (Hendon, north)

  Summers, Sir Spencer

  Kerr, Sir Hamilton

  Osborn, John (Hallam)

  Talbot, John E.

  Kershaw, Anthony

  Osborne, Sir Cyril (Louth)

  Tapsell, Peter

  Kimball, Marcus

  Page, Graham (Crosby)

  Taylor, Sir Charles (Eastbourne)

  Kirk, Peter

  Parmell, Norman (Kirkdale)

  Taylor, Frank (M'ch'st'r, Moss Side)

  Kitson, Timothy

  Partridge, E.

  Taylor,Sir William (Bradford, N.)

  Lagden, Godfrey

  Pearson, Frank (Clitheroe)

  Teeling, Sir William

  Lambton, Viscount

  Peel, John

  Temple, John M.

  Leather, Sir Edwin

  Percival, Ian

  Thatcher, Mrs. Margaret

  Leavey, J. A.

  Peyton, John

  Thomas, Sir Leslie (Canterbury)

  Legge-Bourke, Sir Harry

  Pickthorn, Sir Kenneth

  Thomas, Peter (Conway)

  Lewis, Kenneth (Rutland)

  Pilkington, Sir Richard

  Thompson, Sir Kenneth (Walton)

  Lilley, F. J. P.

  Pitman, Sir James

  Thorneycroft, Rt. Hon. Peter

  Linstead, Sir Hugh

  Pitt, Dame Edith

  Thornton-Kemsley, Sir Colin

  Litchfield, Capt. John

  Pott, Percivall

  Tiley, Arthur (Bradford, W.)

  Lloyd,Rt.Hn.Geoffrey(Sut'nC'dfield)

  Pounder, Rafton

  Tilney, John (Wavertree)

  Lloyd, Rt. Hon. Selwyn (Wirral)

  Powell, Rt. Hon. J. Enoch

  Touche, Rt. Hon. Sir Gordon

  Longden, Gilbert

  Price, David (Eastleigh)

  Turner, Colin

  Loveys, Walter H.

  Price, H. A. (Lewisham, W.)

  van Straubenzee, W. R.

  Lucas, Sir Jocelyn

  Prior-Palmer, Brig. Sir Otho

  Vane, W. M. F.

  Lucas-Tooth, Sir Hugh

  Proudfoot, Wilfred

  Vaughan-Morgan, Rt. Hon. Sir John

  McAdden, Sir Stephen

  Pym, Francis

  Vickers, Miss Joan

  MacArthur, Ian

  Rawlinson, Sir Peter

  Vosper, Rt. Hon. Dennis

  McLaren, Martin

  Redmayne, Rt. Hon. Martin

  Walder, David

  McLaughlin, Mrs. Patricia

  Rees-Davies, W. R. (Isle of Thanet)

  Walker, Peter

  Maclay, Rt. Hon. John

  Renton, Rt. Hon. David

  Walker-Smith, Rt. Hon. Sir Derek

  Maclean,SirFitzroy(Bute&N.Ayrs)

  Ridley, Hon. Nicholas

  Wall, Patrick

  Macleod, Rt. Hn. Iain (Enfield, W.)

  Ridsdale, Julian

  Ward, Dame Irene

  MacLeod, Sir John(Ross & Cromarty)

  Rippon, Rt. Hon. Geoffrey

  Watkinson, Rt. Hon. Harold

  McMaster, Stanley R.

  Roberts, Sir Peter (Heeley)

  Webster, David

  Macmillan, Maurice (Halifax)

  Robinson, Rt. Hn. Sir R. (B'pool,S.)

  Wells, John (Maidstone)

  Maddan, Martin

  Robson Brown, Sir William

  Whitelaw, William

  Maginnis, John E.

  Rodgers, John (Sevenoaks)

  Williams, Dudley (Exeter)

  Maitland, Sir John

  Ropner, Col. Sir Leonard

  Williams, Paul (Sunderland, S.)

  Markham, Major Sir Frank

  Russell, Ronald

  Wills, Sir Gerald (Bridgwater)

  Marlowe, Anthony

  Scott-Hopkins, James

  Wilson, Geoffrey (Truro)

  Marples, Rt. Hon. Ernest

  Seymour, Leslie

  Wise, A. R.

  Marten, Neil

  Sharples, Richard

  Wolrige-Gordon, Patrick

  Matthews, Gordon (Meriden)

  Shaw, M.

  Wood, Rt. Hon. Richard

  Maudling, Rt. Hon. Reginald

  Shepherd, William

  Woodhouse, C. M.

  Mawby, Ray

  Skeet, T. H. H.

  Woodnutt, Mark

  Maxwell-Hyslop, R. J.

  Smith, Dudley (Br'ntf'd & Chiswick)

  Woollam, John

  Maydon, Lt.-Cmdr. S. L. C.

  Smithers, Peter

  Worsley, Marcus

  Mills, Stratton

  Smyth, Rt. Hon. Brig. Sir John

  Yates, William (The Wrekin)

  Miscampbell, Norman

  Soames, Rt. Hon. Christopher

  Montgomery, Fergus

  Spearman, Sir Alexander

  TELLERS FOR THE AYES:

  More, Jasper (Ludlow)

  Speir, Rupert

  Mr. Chichester-Clark and

  Morgan, William

  Mr. Finlay.

  NOES

  Abse, Leo

  Butler, Mrs. Joyce (Wood Green)

  Duffy, A. E. P. (Colne Valley)

  Albu, Austen

  Callaghan, James

  Edelman, Maurice

  Allaun, Frank (Salford, E.)

  Carmichael, Neil

  Edwards, Rt. Hon. Ness (Caerphilly)

  Allen, Scholefie1d (Crewe)

  Chapman, Donald

  Edwards, Robert (Bilston)

  Awbery, Stan (Bristol, Central)

  Cliffe, Michael

  Edwards, Walter (Stepney)

  Bacon, Miss Alice

  Collick, Percy

  Evans, Albert

  Baird, John

  Corbot, Mrs. Freda

  Fernyhough, E.

  Barnett, Guy

  Craddock, George (Bradford, S.)

  Finch, Harold

  Baxter, William (Stirlingshire, W.)

  Cronin, John

  Fitch, Alan

  Beaney, Alan

  Crosland, Anthony

  Fletcher, Eric

  Bellenger, Rt. Hon. F. J.

  Crossman, R. H. S.

  Forman, J. C.

  Benn, Anthony Wedgwood

  Cullen, Mrs. Alice

  Galpern, Sir Myer

  Benson, Sir George

  Dalyell, Tam

  George,Lady MeganLloyd(Crmrthn)

  Blackburn, F.

  Darling, George

  Ginsburg, David

  Blyton, William

  Davies, G. Elfed (Rhondda, E.)

  Grey, Charles

  Boardman, H.

  Davies, Harold (Leek)

  Griffiths, David (Rother Valley)

  Bowden, Rt.Hn. H. W.(Leics,.S.W.)

  Davies, Ifor (Gower)

  Griffiths, Rt. Hon. James (Llanelly)

  Bowen, Roderic (Cardigan)

  Deer, George

  Griffiths, W. (Exchange)

  Bowles, Frank

  Delargy, Hugh

  Grimond, Rt. Hon. J.

  Boyden, James

  Dempsey, James

  Gunter, Ray

  Braddock, Mrs. E. M.

  Diamond, John

  Hamilton, William (West Fife)

  Bradley, Tom

  Dodds, Norman

  Hannan, William

  Bray, Dr. Jeremy

  Doig, Peter

  Harper, Joseph

  Brown, Rt. Hon. George (Belper)

  Donnelly, Desmond

  Hayman, F. H.

  Butter, Herbert (Hackney, C.)

  Driberg, Tom

  Healey, Denis

  Henderson,Rt.Hn.Arthur(RwlyRegis)

  Mapp, Charles

  Silverman, Sydney (Nelson)

  Herbison, Miss Margaret

  Marsh, Richard

  Skeffington, Arthur

  Hewitson, Capt. M.

  Mason, Roy

  Slater, Mrs. Harriet (Stoke, N.)

  Hilton, A. V.

  Mayhew, Christopher

  Slater, Joseph (Sedgefield)

  Holman, Percy

  Mellish, R. J.

  Small, William

  Holt, Arthur

  Mendelson, J. J.

  Smith, Ellis (Stoke, S.)

  Houghton, Douglas

  Millan, Bruce

  Snow, Julian

  Howell, Charles A. (Perry Barr)

  Milne, Edward

  Sorenson, R. W.

  Howell, Denis (Small Heath)

  Mitchison, G. R.

  Spriggs, Leslie

  Howie, W. (Luton)

  Monslow, Walter

  Steele, Thomas

  Hoy, James H.

  Moody, A. S.

  Stewart, Michael (Fulham)

  Hughes, Cledwyn (Anglesey)

  Morris, Charles (Openshaw)

  Stonehouse, John

  Hughes, Hector (Aberdeen, N.)

  Morris, John

  Stones, William

  Hunter, A. E.

  Moyle, Arthur

  Strauss, Rt. Hn. G. R. (Vauxhall)

  Hynd, H. (Accrington)

  Mulley, Frederick

  Stress,Dr.Barnett(Stoke-on-Trent,C.)

  Irvine, A. J. (Edge Hill)

  Neal, Harold

  Swain, Thomas

  Irving, Sydney (Dartford)

  Noel-Baker, Francis (Swindon)

  Swingler, Stephen

  Janner, Sir Burnett

  Noel-Baker,Rt.Hn.Philip(Derby, S.)

  Symonds, J. B.

  Jay, Rt. Hon. Douglas

  Oliver, G. H.

  Taverne, D.

  Jeger, George

  O'Malley, B. K.

  Taylor, Bernard (Mansfield)

  Jenkins, Roy (Stechford)

  Oram, A. E.

  Thomas, George (Cardiff, W.)

  Johnson, Carol (Lewisham, S.)

  Oswald, Thomas

  Thomas, Iorwerth (Rhondda, W.)

  Jones, Rt. Hn. A. Creech (Wakefield)

  Owen, Will

  Thompson, Dr. Alan (Dunfermline)

  Jones, Dan (Burnley)

  Padley, W. E.

  Thomson, G. M. (Dundee, E.)

  Jones, J. Idwal (Wrexham)

  Paget, H. T.

  Thornton, Ernest

  Jones, T. W. (Merioneth)

  Pannell, Charles (Leeds, W.)

  Thorpe, Jeremy

  Kelley, Richard

  Pargiter, G. A.

  Tomney, Frank

  Kenyon, Clifford

  Parker, John

  Wainwright, Edwin

  King, Dr. Horace

  Parkin, B. T.

  Warbey, William

  Lawson, George

  Pavitt, Laurence

  Watkins, Tudor

  Ledger, Ron

  Pearson, Arthur (Pontypridd)

  Weitzman, David

  Lee, Frederick (Newton)

  Peart, Frederick

  Wells, William (Walsall, N.)

  Lee, Miss Jennie (Cannock)

  Pentland, Norman

  White, Mrs. Eirene

  Lever, L. M. (Ardwick)

  Popplewell, Ernest

  Whitlock, William

  Lewis, Arthur (West Ham, N.)

  Prentice, R. E.

  Wigg, George

  Lipton, Marcus

  Probert, Arthur

  Wilkins, W. A.

  Loughlin, Charles

  Proctor, W. T.

  Willey, Frederick

  Lubbock, Eric

  Pursey, Cmdr. Harry

  Williams, D. J. (Neath)

  Mabon, Dr. J. Dickson

  Randall, Harry

  Williams, W. T. (Warrington)

  McBride, N.

  Rankin, John

  Wilson, Rt. Hon. Harold (Huyton)

  MacColl, James

  Ress, Merlyn (Leeds, S.)

  Winterbottom, R. E.

  MacDermot, Niall

  Reid, William

  Woodburn, Rt. Hon. A.

  McInnes, James

  Reynolds, G. W.

  Woof, Robert

  McKay, John (Wallsend)

  Rhodes, H.

  Wyatt, Woodrow

  McLeavy, Frank

  Roberts, Albert (Normanton)

  Yates, Victor (Ladywood)

  MacMillan, Malcolm (Western Isles)

  Roberts, Goronwy (Caernarvon)

  Zilliacus, K.

  MacPherson, Malcolm (Stirling)

  Robinson, Kenneth (St. Pancras, N.)

  Mahon, Simon

  Rodgers, W. T. (Stockton)

  TELLERS FOR THE NOES:

  Mallalieu, E. L. (Brigg)

  Shinwell, Rt. Hon. E.

  Mr. G. H. R. Rogers and Mr. Redhead.

  Mallalieu, J.P.W. (Huddersfield, E.)

  Silkin, John

  Manuel, Archie

  Silverman, Julius (Aston)

  Main Question, as amended, put and agreed to.
  Resolved,
  That this House notes with satisfaction the many improvements made by Her Majesty's Government which have given national insurance and other benefits a greater value than ever before; welcomes the Government's examination of the possibility of further developments in relating benefits to earnings; and is confident that the Government will continue to improve benefits, and in doing so, will have regard particularly to those groups whose need is greatest'

  BUSINESS OF THE HOUSE
  Ordered,
  That the Proceedings on the Air Corporations Bill may be entered upon and proceeded with at this day's sitting at any hour, though opposed—[Mr. Redmayne.]

  AIR CORPORATIONS [MONEY]
  Resolution reported,
  That, for the purposes of any Act of this Session to extend the powers of the British Overseas Airways Corporation and the British European Airways Corporation to borrow from the Minister of Aviation, it is expedient to authorise such increases in the sums which, under section 3 of the Air Corporations Act 1962, may be issued out of the Consolidated Fund as may be attributable to provisions of the said Act of this Session—

  (a) increasing to £125 million the amount of the accumulated deficit on revenue account of the British Overseas Airways Corporation that may be financed by means of sums borrowed from the said Minister;

  (b) substituting the end of March 1966 for the end of March 1964 as the point of time before which any accumulated deficit on revenue account of either Corporation that may be financed as aforesaid must have accrued.

  Resolution agreed to.

  AIR CORPORATIONS BILL
  Considered in Committee; reported, without Amendment; read the Third time and passed.

  HARBOURS [MONEY]
  Resolution reported,
  That, for the purposes of any Act of this Session to establish a National Ports Council; to provide for the control of harbour development and for giving financial assistance for the improvement of harbours; to make other provision respecting the construction, improvement, maintenance and management of harbours; to make provision with respect to charges of certain harbour authorities and lighthouse authorities; and for purposes connected with the matters aforesaid, it is expedient to authorise the making of provision for the financial purposes mentioned below, that is to say,—
  (1) as regards the said Council,—

  (a) for the payment by the Minister of Transport out of moneys provided by Parliament of grants to the said Council in respect of expenses incurred by them in consequence of their complying with a direction given to them by the said Minister under any provision of the said Act;

  (b) for the issue out of the Consolidated Fund of such sums as may be required to enable the said Minister to make loans to the said Council of sums they may require for the exercise and performance of any of their functions under the said Act, but so that the aggregate of the amounts outstanding in respect of the principal of such loans shall not exceed £250,000;

  (2) as regards any person or body engaged in improving, maintaining or managing a harbour,—

  (a) for the issue out of the Consolidated Fund of such sums as may be required to enable the Minister of Transport to make loans to any such person or body—

  (i) in respect of expenses incurred by that person or body for the purposes of or in connection with the harbour, in a case where the said Minister is satisfied
  354
  that the expenses are such as ought properly to be regarded as being of a capital nature;

  (ii) to enable that person or body to repay the whole or part of the principal of, or to pay the whole or part of a sum due by way of the payment of interest on, a loan made to them by the said Minister in respect of such expenses;

  (b) for tie payment by the said Minister out of moneys provided by Parliament of grants to any such person or body in respect of such expenses incurred by him or them as are mentioned in sub-paragraph (a)(i) of this paragraph or to enable him or them to repay the whole or part of a sum due by way of payment of interest on a loan made to him or them by the said Minister in respect of such expenses,
  but so that the aggregate amount of any such loans and giants are as mentioned in this paragraph shall not exceed £50,000,000 or, if so provided by a resolution of the Commons House of Parliament, £100,000,000;
  (3) for the raising under the National Loans Act 1939 of any money required for the purpose of providing sums to be issued as mentioned in paragraphs (1) and (2) above, or for the replacement it of sums so issued:
  (4) for any payment into the Exchequer of any sums received by the said Minister in respect of loans mentioned in paragraphs (1) and (2) above and the issue of such sums out of the Consolidated Fund and the application of such sums, in so far as they represent principal, in redemption or repayment of debt, and, in so far as they represent interest, towards meeting such part of the annual charges for the national debt as represents interest;
  (5) for defraying out of moneys provided by Parliament any increase attributable to the said Act of this Session in the sums payable out of moneys so provided by way of Rate-deficiency Grant of Exchequer Equalisation Grant under the enactments relating to local government in England and Wales or in Scotland;
  (6) for the payment into the Exchequer of any sums, other than those mentioned in paragraph (4) above, falling to be so paid in consequence of any of the provisions of the said Act of this Session.
  Resolution agreed to.

  HOSPITAL ACCOMMODATION, ROTHERHAM
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Peel.]
  10.29 p.m.
  Mr. Brian O'Malley: I raise the question of hospital accommodation in Rotherham on the Adjournment tonight because of the widespread concern and dissatisfaction in the town about the size of the waiting lists. This was a notable feature of the complaints and statements made to me during my by-election campaign in March this year.
  In July this year, the Health Executive Council of Rotherham wrote to me through its clerk expressing its dissatisfaction at the priority which Rotherham had been given in the 10-year plan, Cmnd. 1604, for the building of a new district general hospital. Other organisations in Rotherham have expressed similar views, including a number of trade unions and the Business and Professional Women's Club. I understand that at a recent divisional meeting of the Rotherham branch of the British Medical Association a sub-committee was appointed to investigate die whole question of hospital accommodation in the town.
  The noticeable feature of this concern with the waiting lists in Rotherham and how it differs from the concern which obviously exists all over the country is that the argument being put forward by many people and many organisations in the town is based on their feeling that the priority which has been given to the building of a new district general hospital in Rotherham is wrong; in fact, that it has been wrongly placed in the second quinquennium of the ten-year plan. Therefore, this evening my main concern is to raise the question of the priority, since I have been writing to the Ministry of Health since August of this year and have not got any satisfactory replies. What I am primarily concerned to establish is what the reasons for the priorities are.
  First of all, however, I should like to raise two other points for the consideration of the Joint Parliamentary Secretary. The first concerns the Listerdale Maternity Home where there is a practice of
  356
  discharging women 48 hours after their confinement. It is a practice which is basically the result of pressure of bed shortage. Nevertheless, the staff are doing their best to work the system, but are encountering great difficulties at the moment. In 1960 there were between 550 and 600 deliveries at the maternity home. The number has now jumped, I understand, towards 1,000, and without any proportionate increase in staff. Therefore, one fears that the standard of nursing, the time which midwives can give to women in labour, the supervision of breast feeding for long-stay patients, are suffering. Therefore, I would ask the Minister if he would take up with the hospital management committee the question of a further labour ward and the question of the employment of extra mid-wives, nurses and also clerical assistance.
  I raise this point because the hospital management committee is apparently dragging its feet, and has been on this issue since May of this year, and I believe that this simply will not do, for we are concerned about the large numbers of women who are going into the home for confinement.
  The second point I wish to raise is that of existing buildings, and I raise it because we cannot have a new hospital there in the immediate future and it would appear that if the priorities which are at present in operation continue we shall not have a new hospital there till about 1975. Yesterday I had a letter from the chairman of the Sheffield Regional Hospital Board telling me that various improvements were to be made, but since we shall not have a new hospital, apparently, for some years, I would stress to the Parliamentary Secretary the importance in Rotherham of having a new operating theatre at Doncastergate Hospital. We need two new wards there. I understand that the management committee is pressing Sheffield Regional Hospital Board to provide these. Particularly are we in need of another female surgical ward. When one goes round the hospital one is particularly impressed by the shortage of an adequate urine testing room, a shortage even of wash basins.
  There are girls working in the records department at Doncastergate Hospital in craft conditions reminiscent of the

  357
  worst years of the last century. I have wandered around the health authorities, the factory inspectorate—anywhere I could—to see if something could be done about the disgraceful conditions in which these girls are working, and although I understand that nothing can be done through legislation at the moment, I would appreciate it if in the near future we could have some improvements in the conditions in which these girls work.
  The last of the minor points I should like to raise is this. I understand from the minutes of Sheffield Regional Hospital Board of 9th September this year that 537 beds in the region were closed during the last year, and I should like to know if any of those were in Rotherham hospitals.
  The major point that I wish to raise is the question of the priority, which I consider to be wrong. I sent a memorandum to the Minister in August in which I demonstrated statistically and in considerable detail that there was an overwhelming case for the building of a new district general hospital in Rotherham at an earlier date than the vague one that we have beengiven—some time in the 'seventies.
  First of all, the localities and the organisations therein were not consulted. It is true that the health executive, the county borough and the local medical committee were asked for their opinions about the scheme on the broad plans for a new hospital, but at no time were the statistical criteria presented to demontrate that we were in our proper place in the queue.
  I have had letters from the Parliamentary Secretary and recently from the chairman of the regional hospital board. The Parliamentary Secretary completely avoids my question: what were the statistical criteria? I believe that Members of Parliament and the public have a right to know the reasons underlying decisions taken by public authorities and boards. The chairman of the board has largely ignored my question.
  On the revised plan, I want to ask one thing. I understand that on the new population projections we shall have only 3·2 acute beds per 1,000 population in Rotherham by 1975 while the national average is to be 3·4 beds per 1,000. Rotherham is an area of considerable in-
  358
  dustrial pollution of the atmosphere, and there is a high incidence of bronchial diseases.
  Lastly, with the priority which we are given, in 1960 the Sheffield region had fewer acute beds per 1,000 population than almost any other region in the country. The board has recently acknowledged to me the urgent need for other hospital accommodation, and when it says that at the moment it cannot do any more I put the blameand onus on the Ministry because it seems to me that the allocation of money per head of the estimated 1975 population is a grossly unsure way of arriving at the correct arrangement.
  The detailed figures which I sent to the Parliamentary Secretary were rejected on the ground that the area was too small to consider in isolation, and he said that comparisons should be made with Sheffield. They can be, but the statistics for other areas are similarly affected. It is also true that people from other hospital management committee areas come for treatment at Rotherham hospitals. I have looked up the improvements figures, and would like the hon. Gentleman to examine them in detail. The basic situation in Rotherham is worse than it is in other areas where improvements are being made in the 'sixties. There are fever acute beds in Rotherham than in other areas.
  With regard to maternity beds, the situation in the Sheffield region is almost the worst in the country, but the situation in the Rotherham-Mexborough area is worse than any other. We have no mental illness beds, and there is considerable strain on the local mental health section. There are some areas where the general surgery priority is better than in Rotherham, where the waiting lists represent 44 per cent. of the total in the hospital management committee area. Other areas are getting new accommodation, whereas we are in the second part of the plan.
  With regard to criteria, on 29th July I asked what the average waiting time was, and was told that the information was not known or was not available. I ask the Parliamentary Secretary to look in detail at the statistical criteria which have resulted in Rotherham being put into the second part of the ten-year plan, and I ask him to give me the criteria so

  359
  that I can make a judgment and so that my constituent can. If we cannot be given the criteria, we can only come to the conclusion either that there has been massive incompetence in high places in the planning of the priorities or that it is thought that Members of Parliament and the public have no right to know the facts. I reject this view entirely, and I hope that the Parliamentary Secretary does. I hope that in view of the situation and the accuracy of my figures, which the hon. Gentleman has not disputed—although I am quite prepared to be proved wrong—he will agree that we have an overwhelming case to be put in the first part of the ten-year plan. This is what I ask him to reconsider.
  10.40 p.m.
  The Joint Parliamentary Secretary to the Ministry of Health (Mr. Bernard Braine): I should like, first, to thank the hon. Member for Rotherham (Mr. O'Malley) for giving us the opportunity tonight to discuss the question of hospital accommodation in Rotherham. Rotherham needs a new hospital. This, at least, is common ground between us. Hospital services are provided in a number of different premises in the neighbourhood. These premises are inadequate in the sense of not being able to provide a sufficient number of beds in various categories. They are also old, and in many ways they are not suited to meet the requirements of a modern hospital. The hon. Member has itemised a number of points which need improvement and I will, if I may, return to that aspect later.
  Let me say at the outset that a satisfactory solution to Rotherham's problem cannot be found by adding to and improving any of the existing hospitals. Only a radical change, by starting afresh and building a completely new district general hospital, will solve the problem. This is what the Hospital Plan envisaged for Rotherham—a district general hospital to be started in the second quinquennium, between 1967 and 1971; and, fortunately, a suitable site is already in our possession at Oakwood Hall. The main contention, however, which the hon. Member has advanced vigorously tonight, is that Rotherham deserves to have its hospital earlier than has been indicated in the Hospital Plan.
  360
  It might be helpful if I devote a few moments to the general question of priorities. In 1948, the National HealthService inherited 2,800 hospitals. Of these, 45 per cent. were erected before 1891 and 21 per cent. before 1861. Even where these hospitals had been subsequently modified, many of them were quite unsuitable for the practice of modern medicine.
  In the first 10 years after the war, the capital available for hospital renewal was small and even the increasing expenditure thereafter was insufficient to achieve a really adequate development programme. That was why, two years ago, the Government put in hand what can truly be described as an imaginative plan for providing the country with the most up-to-date and comprehensive hospital service in the world. Even so, despite the decision that substantially increased funds would need to be committed in future years, my Department and the hospital boards were, and are, faced with acute problems in regard to priorities.
  Let me explain this. In all our planning, we have had to try to give priority to areas where the needs are most acute and to maintain a proper balance between modernisation and the provision of additional beds to meet existing deficiencies. It is quite impracticable to replace more than a proportion of the obsolete hospital buildings over the country as a whole within 10 or 15 years, nor can the historical distribution of beds in the various parts of the country be rationalised over a short period. The Hospital Plan does not purport to achieve an ideal hospital service by 1975 or, for that matter, by any date. It does, however, provide for the first time a national framework within which detailed planning can be undertaken with vigour and confidence.
  I readily concede that there is a great deal to be done in the Sheffield Regional Hospital Board's area. I hope that the House will appreciate the very real problems which regional boards—not merely the Sheffield board—have to face in trying to determine orders of priority between schemes for different districts in their regions. As the hon. Member mentioned, for hospital services Rotherham has been traditionally linked closely with its near neighbour,

  361
  Sheffield. Many Rotherham people receive hospital treatment in Sheffield hospitals.
  Mr. O'Malley: The hon. Gentleman will realise that a number of my constituents go into Sheffield hospitals because they cannot get accommodation in Rotherham hospitals. The link is nothing like as close as the hon. Member suggests.
  Mr. Braine: That is true. It is also true that Rotherham in turn provides facilities for some patients from elsewhere. But, to be fair to the hon. Gentleman, Rotherham is by and large an exporter of patients.
  The regional board has felt that in Sheffield the first priority should be accorded to the completion of the new teaching hospital. I think that is right. Undoubtedly, Rotherham will derive some benefit from this very important development.
  But while this influences priority, I should like to emphasise that, in planning the size of the new hospital for Rotherham, the board is reckoning to provide sufficient beds to cater ultimately for all the district's basic needs within Rotherham itself. There are, of course, certain specialties which it is only sensible to provide on a regional basis at a limited number of centres. The idea is to solve, as far as is humanly possible, the Rotherham problem within Rotherham itself.
  But, apart from this close association with Sheffield, how does Rotherham compare with other places in the region? The hon. Member is a doughty champion of his constituency, but one has to recognise that judgments of priorities are at least as much subjective as objective.
  One cannot concentrate on just making up the number of beds short and ignore the need to improve existing facilities. The hon. Member has said that Rotherham deserves attention on both counts, and he is right. But in fact a number of places in the Sheffield region are worse off. Barnsley, Doncaster, Scunthorpe, Leicester and Chesterfield all have a lower ratio of acute beds to population. Some of these places can be helped by additions and adaptations. Some, like Rotherham, need a new hospital alto-
  362
  gether. I have Barnsley in mind. To change priorities now can only mean that some others of these schemes would have to be displaced. I cannot think that would be right.
  Perhaps I should also make it clear—the layman does not always understand this—that there is a time factor involved in providing a new hospital. Planning and building a modern hospital is a much more complex affair than putting up a factory or a housing estate. For one thing, it involves the provision of buildings which must take account of the continuous and inevitable changes in the range, scope and character of medical care in the decades ahead.
  Thus, a great deal of work goes into the detailed planning of such a scheme. To start from scratch with planning a new hospital must take longer than planning additions to an old one. The board feels that it will need every minute of the time in which to plan for the new hospital at Rotherham even to achieve the starting date at present contemplated. I must ask the hon. Member to accept that it does take a considerable period, with the best will in the world, to plan a hospital on the scale that Rotherham is entitled to have.
  Mr. O'Malley: But the hon. Member surely knows that this new hospital has been on the stocks since 1952 and that a document was published by the board as long ago as 1955 discussing the project. What my constituents would like to know is what has been happening in this period? The hon. Member mentions places worse off. I know that Doncaster—seat of the Minister of Health—must be one of the worst situated in the country. But I dare say there are other places in the region which are better off for accommodation which were in the first part of the programme.
  Mr. Braine: The hon. Member has ignored the point that to alter the priorities now would entail interfering with the plans for every other area in the region which is worse off in this respect than Rotherham, and, as I have said, I cannot believe that that is right, or that even the hon. Member's own constituents would want it that way. I can assure him that the regional board has told me that it will need every minute of the time that it has in which to get the hospital

  363
  started at the date at present contemplated.
  The hon. Member and I have exchanged correspondence on this subject, and he mentioned that fact tonight. Since then I understand that he had taken up with the board his point about the basis of fact and argument on which its decision about Rotherham's priority rests. I hope that he will now feel that there is no attempt to shroud this in mystery. I know that the board is quite willing to discuss the matter further with him if he wishes.
  I want to make one point absolutely plain. Estimated increases in future population are taken fully into account in the detailed planning of schemes within the Hospital Plan. In fact, the Sheffield Regional Hospital Board has recently received a new population projection for Rotherham from the West Riding County Council, and appropriate revisions have been made in the bed numbers planned for the future. Now that the bed numbers have been revised, the planning of the new district general hospital will be put in hand with the intention of starting work in 1970–71.
  It is true that there are some fairly long waiting lists for admission to the Rotherham Hospital, but it is a matter of experience that waiting lists do not, by themselves alone, provide a reliable guide in assessing priorities. By selecting figures for particular specialties it is possible to indicate specific shortages of beds in many areas. If we consider the number of persons waiting per bed, the figures for Rotherham and Mexborough show that the area is in a better position than the region as a whole in some specialties, but worse in others. The total figure for the Rotherham waiting list at the end of September, 1963, was 1,949, which shows a reduction of 332 on the corresponding figure for the previous year. I am not satisfied with these figures, and I can assure the hon. Member that the regional board is continuing to examine the measures which might be taken to improve the hospital services for Rotherham during the period before the new district general hospital comes into use.
  Waiting lists all over the country, not only in Sheffield, are now being
  364
  scrutinised. My Department impressed on hospital authorities at the beginning of the year the need to reduce them, and gave advice on various ways in which a short-term drive might help to achieve a permanently improved position.
  The hon. Member mentioned the question of staff shortages and the general situation at the Listerdale Maternity Home. I have taken note of what he said. I will certainly take up one of the points he made. I do not think, however, that it is fair to say that anyone is dragging his feet. My understanding is that a proposal is at present before the hospital management committee to increase the contribution which this useful general practitioner unit of 24 beds can make to the local maternity service by a greater use of early discharge of patients in suitable cases. This would require additional staff. These proposals have yet to be considered, and I think the hon. Member would agree that in the circumstances I ought not to comment further at the moment.
  Perhaps I may be allowed to say in the context of maternity needs that other schemes in the district may help as they come to fruition. Next year, for example, it is expected that an additional 20 maternity beds will be completed at the Montague Hospital at Mexborough. A new maternity unit is being provided at Doncaster Royal Infirmary and when this is completed it is intended to retain the present maternity beds in the Western Hospital at Doncaster as reserve capacity.
  I promised to say a few words about what could be done in the short term to improve conditions in the existing Rotherham hospitals. The hon. Member has written to me about this. We have to set a limit to what we can usefully do to improve premises which, in duecourse, will be superseded. That makes sense. Some shortcomings cannot be tackled at all and here we must build anew. At Moorgate Hospital some improvements can be made. The regional hospital board intends to improve the operating theatre facilities and the practical problems are being tackled now with a view to the work being done next year. The vacation by the local authority of the premises known as "The Mount" and agreement to make some of the buildings available to the hospital

  365
  should enable improvements to be made to the kitchen. We all know how important it is to the well-being of patients to have good cooking facilities. This will also permit a central sterile supply service to be introduced.
  The regional hospital board does not feel able to provide an additional operating theatre at the Doncastergate Hospital, but the old theatre is to be improved as soon as possible. A new physiotherapy department is to be built at this hospital and alterations and improvements made to the out-patient and accident departments. This scheme will also include a new gymnasium.
  The hon. Member asked me about the figures for beds in the Rotherham area. I am advised that the figure for Rotherham will be about 3·1 per 1,000 population, but this will not include regional specialties which are provided in Sheffield. One can easily get confused about these figures and ratios. The whole object of the Hospital Plan is to bring to every part of the country the fullest range of facilities for treatment and diagnosis. AsI said at the beginning, many of our hospitals are out of date, and many of them are in the wrong
  366
  places. One should not be mesmerised by these figures. The whole aim of the Hospital Plan is to produce a comprehensive cover for every part of the country.
  The hon. Member said something about the question of early discharge of maternity cases. Opinions differ about the extent to which early discharge would be reasonable or desirable even if there were no shortage of maternity beds. The Cranbrook Committee envisaged a 10-day stay in hospital with 70 per cent. of all confinements taking place in hospital. The fact is that not many hospital maternity cases give rise to medical complications. For this reason, doctors may think that early discharge is suitable.
  I have, I think—
  The Question having been proposed after Ten o clock and the debate having continued for half an hour, Mr. Deputy-Speaker adjourned the House without Question put, pursuant to the Standing Order.
  Adjourned accordingly at one minute to Eleven o'clock.

ADEN
  School Places
  School Places
VIRGIN ISLANDS
  Colonial Development and Welfare Moneys
  Colonial Development and Welfare Moneys
HONG KONG
  Legislative and Executive Councils
  Legislative and Executive Councils
MALTA
  U.K.-Malta Travel Facilities
  U.K.-Malta Travel Facilities
  Unemployment
  Unemployment
  Independence
  Independence
BECHUANALAND AND NORTHERN RHODESIA
  Border
  Border
BASUTOLAND
  Afforestation
  Afforestation
  Diamonds
  Diamonds
SEYCHELLES
  United States Tracking Station
  United States Tracking Station
BECHUANALAND
  Census
  Census
NYASALAND
  Malawi Congress Party
  Malawi Congress Party
PUBLIC BUILDING AND WORKS
  Housing (Prefabrication)
  Housing (Prefabrication)
  Little Aden (Housing Scheme)
  Little Aden (Housing Scheme)
  Security
  Security
  London Municipal Society (Dinner)
  London Municipal Society (Dinner)
  Puritan Chapel, Bramhope
  Puritan Chapel, Bramhope
  Shipyards (Glasgow Inquiry Centre)
  Shipyards (Glasgow Inquiry Centre)
  Contracts
  Contracts
SCIENCE
  Engineering Textbooks
  Engineering Textbooks
  Meat Research Institute
  Meat Research Institute
WELSH AFFAIRS
  Water Resources, Wales
  Water Resources, Wales
  Depopulation in Mid-Wales (Report)
  Depopulation in Mid-Wales (Report)
LOCAL GOVERNMENT
  Washington New Town, County Durham
  Washington New Town, County Durham
  Town and Country Planning Inquiries (Godstone)
  Town and Country Planning Inquiries (Godstone)
  Beverley Town Map
  Beverley Town Map
  Coventry, Northampton, Stoke-on-Trent and Tamworth
  Coventry, Northampton, Stoke-on-Trent and Tamworth
  London Government Act, 1963
  London Government Act, 1963
  Eastern European Countries (Exchange Visits)
  Eastern European Countries (Exchange Visits)
  Bombed Sites
  Bombed Sites
  Clean Air Act (Oil Heaters)
  Clean Air Act (Oil Heaters)
  South-East Development Plan
  South-East Development Plan
HOUSING
  Temporary Bungalows
  Temporary Bungalows
  New Houses
  New Houses
NATIONAL FINANCE
  Civil Service (Clerical Assistants)
  Civil Service (Clerical Assistants)
  White Papers
  White Papers
  National Economic Development Council
  National Economic Development Council
  Royal Philharmonic Orchestra
  Royal Philharmonic Orchestra
  Local Authorities (Borrowings)
  Local Authorities (Borrowings)
  Members (Envelope Supplies)
  Members (Envelope Supplies)
  Trading Stamps
  Trading Stamps
  Works of Art (Export)
  Works of Art (Export)
  Motor Industry (Wages)
  Motor Industry (Wages)
  Judiciary (Salaries)
  Judiciary (Salaries)
  Profits and Dividends
  Profits and Dividends
  Wages and Salaries
  Wages and Salaries
MINISTRY OF DEFENCE
  Defence Policy
  Defence Policy
  PRICES AND RENTS
  PRICES AND RENTS
  MINISTER FOR SCIENCE (SPEECH)
  MINISTER FOR SCIENCE (SPEECH)
  WAGES AND SALARIES
  WAGES AND SALARIES
MINISTRY OF AVIATION
  Air Transport Licensing Board Services (Statistics)
  Air Transport Licensing Board Services (Statistics)
  Corbett Report (Cost)
  Corbett Report (Cost)
  B.O.A.C. Services (Route Planning)
  B.O.A.C. Services (Route Planning)
  B.O.A.C. Deficit
  B.O.A.C. Deficit
  Scandinavian Air Services Traffic Rights, Prestwick
  Scandinavian Air Services Traffic Rights, Prestwick
  B.E.A. and B.O.A.C.
  B.E.A. and B.O.A.C.
RHODESIA AND NYASALAND
  Federation (Dissolution)
  Federation (Dissolution)
  KENYA INDEPENDENCE (GIFTS)
  KENYA INDEPENDENCE (GIFTS)
ROYAL NAVY
  H.M. Nuclear Submarine "Valiant"
  H.M. Nuclear Submarine "Valiant"
MALDIVE ISLANDS
  Independence
  Independence
  Addu Atoll
  Addu Atoll
SKOPJE
  Earthquake Disaster
  Earthquake Disaster
  UNIVERSAL DECLARATION OF HUMAN RIGHTS
  UNIVERSAL DECLARATION OF HUMAN RIGHTS
INDUSTRY, TRADE AND REGIONAL DEVELOPMENT
  Industrial Development Certificates, Wales
  Industrial Development Certificates, Wales
  Japan (Minister's Visit)
  Japan (Minister's Visit)
SOUTHERN RHODESIA
  Grants and Loans
  Grants and Loans
HOME DEPARTMENT
  Metropolitan Police Force (Cadets)
  Metropolitan Police Force (Cadets)
  Child-care Officers
  Child-care Officers
EMPLOYMENT
  Window Cleaners (Safety Regulations)
  Window Cleaners (Safety Regulations)
  Glamorgan and Monmouthshire
  Glamorgan and Monmouthshire
HOSPITALS
  Maternity Beds, Greater London
  Maternity Beds, Greater London
SCOTLAND
  Traffic Congestion, Glasgow
  Traffic Congestion, Glasgow
  Housing, Glasgow
  Housing, Glasgow
  Clyde Tunnel Scheme (Payments)
  Clyde Tunnel Scheme (Payments)
TECHNICAL CO-OPERATION
  Northern Rhodesian Public Service Officers (Status)
  Northern Rhodesian Public Service Officers (Status)
TRANSPORT
  Abandoned Vehicles (Prosecutions)
  Abandoned Vehicles (Prosecutions)
  Drivers (Defective Vision)
  Drivers (Defective Vision)
RAILWAYS
  Proposed Closures
  Proposed Closures
  Proposed Closures (Bletchley-Buckingham Service)
  Proposed Closures (Bletchley-Buckingham Service)
TRANSPORT
  Motorways (Lorries)
  Motorways (Lorries)
  Motor Vehicles (Mud Flaps)
  Motor Vehicles (Mud Flaps)
  Goods Vehicles (Gross Weight)
  Goods Vehicles (Gross Weight)
  50 m.p.h. Speed Limit
  50 m.p.h. Speed Limit
ROADS
  North Cray Road, Sidcup (Accidents)
  North Cray Road, Sidcup (Accidents)
  A.1 Road (Yorkshire Section)
  A.1 Road (Yorkshire Section)

Preamble
The House met at half past two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Durham
The Earl of Dundee (Lord Glassary)—Took the Oath and subscribed the Roll as Earl of Dundee, having laid on the Table his Writ of Summons issued in pursuance of the provisions of Section 4 of the Peerage Act, 1963.

REBUILDING OF FOREIGN OFFICE
2.35 p.m.
LORD HAWKE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether, in view of the immense programme of capital works of the highest priority to be undertaken in the near future by the Government and their Agencies, and thus the great need for economy on less essential projects, they will set a good example to the nation by refraining from demolishing and rebuilding the Foreign Office in present circumstances.]
THE FIRST LORD OF THE ADMIRALTY (EARL JELLICOE): My Lords, it is essential that the Foreign Office and Commonwealth Relations Office should be suitably and adequately accommodated in a building which enables them efficiently to discharge their responsibilities. Her Majesty's Government do not accept the implication in the noble Lord's Question that the rebuilding of the Foreign Office is to be classified as a less essential project. However, allowing time for necessary preparations, and for the arrangement of alternative accommodation, it will necessarily be some years before work can be started on a new building. Her Majesty's Government see no reason why this important scheme should not then
1102
take a place in their building programme, along with other important Government projects.
LORD HAWKE: My Lords, I thank my noble friend for his reply, which is more comforting than I thought, because there are several years of respite. Will my noble friend give me an assurance that the pulling down and the replacement of this building will not take place while the London building industry is in the grossly extended state it is in at the present moment?
EARL JELLICOE: My Lords, I am glad my noble friend has been comforted by my reply. I do not think I can give him any assurance as regards specific dates, but I can repeat or re-phrase the assurance in my original reply: that it will necessarily be some time before this scheme can come to fruition.
LORD SILKIN: My Lords, in view of the fact that this is a matter which is arousing a good deal of controversy, would the Government be prepared to state the case for demolishing, in rather more detailed terms than the noble Earl has done in answer to this Question? If one were satisfied that the Foreign Office could not discharge its functions effectively except in a new building, that would make some difference to the attitude of those who are against demolition. Would the noble Earl consider that?
LORD REA: My Lords, before the noble Earl replies, may I add a corollary? Would he consider leaving the outside of the building as it is and rearranging the inside according to modern standards?
EARL JELLICOE: My Lords, if I may, I will take the second supplementary question first. Of course, the proposal put by the noble Lord was carefully considered and that was the original intention. But it was decided, after considerable reflection, that to modernise the building while preserving the existing façades would be inadequate, inefficient and, indeed, uneconomic. Those, of course, are the broad considerations which have been in the Government's mind. But I will certainly see that the point made by the noble Lord, Lord Silkin, is conveyed to my right honourable friend.
LORD COLYTON: My Lords, may I ask Her Majesty's Government whether, in considering designs for rebuilding, they will have regard to the designs of Inigo Jones which were, in fact, incorporated in the present building, and of which the only original room remaining is the Banqueting Hall? Will they have regard to those designs so as to help to bring about a regular and symmetrical building in that area?
EARL JELLICOE: My Lords, of course the Government are most anxious that the new building in this particular situation should be the best possible building and one suitable for its special environment. Again, I will certainly draw my noble friend's suggestion to my right honourable friend's attention.
BARONESS HORSBRUGH: My Lords, as the noble Earl has said that it would be inadequate and inefficient to alter the inside of the building, can he tell us whether this has been the opinion of all modern architects who have been consulted? Or have they not been consulted?
EARL JELLICOE: My Lords, it has certainly been the opinion of those responsible architects whom my right honourable friend has consulted.
LORD FERRIER: My Lords, may I ask the noble Earl whether it is proper to assume from his reply that the intention would be to increase the number of individuals, notably of junior status, in the new building as compared with the number to-day?
EARL JELLICOE: My Lords, it is certainly the intention to allow for more staff to be able to work in the new building, in far better conditions than those which exist at the present time. I myself have worked in the present building, and I know that, whilst it is to a certain extent suitable for senior staff, the conditions in which junior staff work in the existing Foreign Office building are quite lamentable.
LORD HAWKE: My Lords, would it not be doing a great service to the world if, instead of contemplating an increase in the Foreign Service, the Government set an example by decreasing the Foreign Service? Would that not provide an example to the rest of the world, most of whose foreign services are being maintained by people who, we allege, are three-quarters starved?
EARL JELLICOE: My Lords, although my noble friend's supplementary does touch on the question of economy, I do not see how it is otherwise related to his original Question.

SOUTH ARABIAN FEDERATION AND FINANCIAL AID
2.41 p.m.
THE EARL OF SANDWICH: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether it is the South Arabian Federation's intention to seek financial aid elsewhere than from the United Kingdom.]
THE MINISTER WITHOUT PORTFOLIO (LORD CARRINGTON): My Lords, I understand so. Apart from providing financial assistance to the Federation from its own resources, Her Majesty's Government are willing to help it in applying for such aid from any other suitable source.
THE EARL OF SANDWICH: My Lords, does this not set a precedent in that there is, I think, no dependent territory at the moment which is allowed to seek financial assistance otherwise than from the United Kingdom? Ought we not to meet the legitimate desires of the South Arabian Federation in full?
LORD CARRINGTON: My Lords, I am not quite sure whether or not this is a precedent, but, of course, we are spending a very large sum of money each year in the South Arabian Federation, and in Aden. In the last five years it has exceeded £27 million. But, of course, a great deal of money needs to be spent in this territory, and I should have thought that, provided that the sources from which this aid would come are suitable, no particular harm is done.
THE EARL OF SANDWICH: My Lords, I do not know whether my noble friend is able to express concern to the House about the news in the newspapers this afternoon to the effect that there has been a dastardly outrage in Aden. The High Commissioner has been wounded and Sultan Ahmed, the Minister of National Enlightenment, has

1105
also been severely wounded. Is there any statement the Government can make on that?
LORD CARRINGTON: My Lords, it is rather a different question, but I know that your Lordships will be interested in this outrage. The information we have is that the High Commissioner was waiting for the departure of an aircraft to come to this country with certain Ministers when a grenade exploded in the middle of a group of persons. One person was killed and 39 injured, including two British officials, and the High Commissioner himself was slightly injured. Among those admitted to hospital were the Yemeni Royalist Foreign Minister. I am sure the whole House will join with me in expressing indignation at this outrage and extending sympathy to those who have been wounded.
SEVERAL NOBLE LORDS: Hear, hear!

OIL POLLUTION OF THE SEA
2.45 p.m.
LORD HURCOMB: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they are in a position to state how many countries have already acceded to the International Convention of 1962 on the Prevention of Pollution of the Sea by Oil and what further accessions are still required in order to bring the full provisions of the new Convention into force.]
LORD CARRINGTON: My Lords, there is no 1962 International Convention as such, but nine countries, including the United Kingdom, have so far accepted the amendments to the 1954 Convention which were adopted by last year's International Conference. The amendments will come into force twelve months after the date on which they have been accepted by two-thirds of the countries who will have then ratified the Convention. These at present number 24.
LORD HURCOMB: My Lords, in thanking the noble Lord for his Answer, may I ask whether this means that a two-thirds majority of those who have now agreed to the Convention is
1106
required but not two-thirds of those Governments who had agreed to the Convention at the time the amendments were made? Is the noble Lord aware that that was the impression in certain quarters as to what would be likely to happen?
LORD CARRINGTON: My Lords, I think it is two-thirds of the 24.
LORD HURCOMB: My Lords, in that event, in view of the great and beneficial initiative which Her Majesty's Government have shown in the past, could they take any steps to urge the number of Governments whose consent is now required to consent to the amendments and so bring the amended Convention into operation?
LORD CARRINGTON: My Lords, there is an organisation called the Inter-Governmental Maritime Consultative Organisation, who are the bureau for the Convention, and it is their job to do precisely what the noble Lord suggests that Her Majesty's Government should do. But, of course, we shall support that organisation and will continue to take such steps as we can to do as the noble Lord suggests.
LORD HURCOMB: My Lords, I am obliged to the noble Lord for saying that. I am quite sure that the—I will not say pressure, but the interest shown by Her Majesty's Government in the speedy acceptance of the amended Convention would have a very good effect among many of the hesitating countries.
LORD CARRINGTON: My Lords, I am sure that is so.

RHODESIAN FEDERATION'S PUBLIC DEBT
2.47 p.m.
LORD COLYTON: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government whether they will associate themselves with the guarantees to be given by the Governments of Southern Rhodesia, Northern Rhodesia and Nyasaland of their respective shares of the Federal public dept on the dissolution of the Federation of Rhodesia and Nyasaland.]
THE LORD CHANCELLOR (LORD DILHORNE): My Lords, if the noble Lord is asking whether Her Majesty's Government will give a guarantee in relation to the public debt of the Federation as apportioned to the three Territories on dissolution, the answer is in the negative.
LORD COLYTON: My Lords, this is an important question. The Federal debt amounts to over £280 million, of which, I understand, half is in internal loans, and this is to be divided into three tranches in the three Territories. May I ask my noble and learned friend these questions? Is it not a fact that the aggregate of the individual credits which are to be assumed by the Territories will not in any way be comparable with the credits of the existing Federation? Secondly, is it not a fact that there are thousands of small shareholders, as well as the insurance companies, banks and big corporations, who are gravely concerned at the diminution in the security which will result from these proposals? Thirdly, may I ask my noble friend whether he is aware that these loans were issued in this country through the Bank of England, who were appointed Registrar and paying agents, and that the underwriting arrangements were all made through the Government Broker? Finally—and this affects only the internal loans—is the noble Lord aware that the holders of these loans are all bound to suffer considerable currency risk as a result of these proposals?
THE LORD CHANCELLOR: My Lords, the point raised by the noble Lord is much the same as points which have been made recently by Sir Roy Welensky, and the reasons why Her Majesty's Government are unable to agree to give such a guarantee have already been communicated to Sir Roy Welensky. It is difficult to deal with this matter adequately by way of question and answer. I understand that the draft of the Order in Council providing for the dissolution of the Federation and for other matters will be laid to-day and it would, I would suggest, be more satisfactory to deal with this question fully in the debate on the draft Order. I do not agree with the proposals put forward at the beginning by the noble Lord.
LORD COLYTON: My Lords, I must ask my noble friend this: is it not a fact that the dissolution of the Federation was the result of a direct decision on the part of Her Majesty's Government and that that decision has now been implemented by means of a sovereign act of the British Parliament? In these circumstances is this not a direct responsibility of Her Majesty's Government?
THE LORD CHANCELLOR: I do not accept the contention that political responsibility for the dissolution of the Federation rests with Her Majesty's Government. The fact of the matter is that two of the Territories declined to remain within the Federation, and it is against this background that Her Majesty's Government's decisions and actions are to be judged.
THE EARL OF LISTOWEL: My Lords, may I ask the noble and learned Lord whether, when we come to debate this matter (I agree that this is not the moment), he will be willing, on behalf of Her Majesty's Government, to explain fully the reasons why the Government are not willing to give any guarantee to the bondholders in the loans of the Federation.
THE LORD CHANCELLOR: Certainly, my Lords. I should perhaps add that the Territorial Governments have accepted in full, and in agreed proportion, as from the date of dissolution, the debt obligations now resting on the Federal Government, and Her Majesty's Government do not regard themselves as under any obligation to give a guarantee in relation to stock which has never been guaranteed by the United Kingdom.
LORD COLYTON: My Lords, in view of what my noble and learned friend says about the possibility of discussing this matter further on the Order in Council, I will not do what I should otherwise have done; that is, to say that I should like to put down a Motion for discussion next week. But may we have at least this minimum assurance: that Her Majesty's Government will be willing to issue a statement to the effect that they will use their best endeavours at all times to ensure the servicing of these loans and to ensure that the repayment of capital at maturity will be undertaken?
THE LORD CHANCELLOR: My Lords, Her Majesty's Government are

1109
certainly not indifferent to the legitimate interests of the stockholders and have had this matter much in mind during several months of negotiations. But that is quite a different matter from accepting the responsibility by guaranteeing these debts.

ARABS AND BRITISH TRADE WITH ISRAEL
EARL ALEXANDER OF HILLSBOROUGH: My Lords, may I ask the noble Lord the Leader of the House the question of which I have given Private Notice, whether any statement will be made to-day with regard to the question of certain Arab countries interfering in British trade and commerce in relation to their boycott of Israel?
LORD CARRINGTON: My Lords, a statement is to be made in another place at half past three, and, if the noble Earl the Leader of the Opposition would agree, I think perhaps it would be convenient if we followed the usual practice of having the statement repeated here as soon after half past three as convenient.

PROCEDURE OF THE HOUSE COMMITTEE
2.54 p.m.
Order of the Day read for the consideration of the First Report from the Select Committee.
The Committee's Report was as follows:
1. MATTERS "SUB JUDICE"
The Committee consider that the practice governing Motions and Questions relating to matters "sub judice" should be similar in both Houses, and recommend the inclusion in the new Companion to the Standing Orders of a passage setting out the practice.
2. CLOSURE
The Committee have considered the recommendation made in the Report of the Procedure Committee (18th July, 1961) regarding the. Motion "That the Question be now put" and recommend the inclusion in the new Companion to the Standing Orders of a method of drawing the attention of the House to that recommendation when a Motion for the Closure is moved in the House.
3. NO QUORUM ON A DIVISTON
The Committee recommend that when, in accordance with the provisions of Standing
1110
Order No. 50 (Quorum for division on Bills and on subordinate legislation), there is no quorum on a division and the proceedings are adjourned, on any subsequent proceedings Lords who have already spoken should be permitted to speak again.
4. STANDING ORDER No. 44A (PRINTING OF BILLS BROUGHT FROM THE COMMONS)
The Committee recommend that Standing Order No. 44A be amended so as to enable the Clerk of the Parliaments to arrange for the printing and circulation of copies of a Bill, brought up from the House of Commons at a time when the House is not sitting, if it is for the convenience of the House that copies of the Bill be circulated before it is read a First Time.
5. COMPANION TO THE STANDING ORDERS AND GUIDE TO THE PROCEEDINGS OF THE HOUSE
The Committee have considered the proof of the new "Companion to the Standing Orders and Guide to the Proceedings of the House of Lords" and recommend that the House should authorise the Clerk of the Parliaments to publish it in that form and lay it on the Table of the House.
THE CHAIRMAN OF COMMITTEES (LORD MERTHYR): My Lords, I beg to move that this Report be now considered.
Moved accordingly, and on Question Motion agreed to.
LORD MERTHYR: My Lords, I beg to move that this Report be agreed to.
Moved, That the Report be agreed to.—(Lord Merthyr.)
On Question, Motion agreed to.

AIR FORCE ACT, 1955 (CONTINUATION) ORDER 1963
EARL JELLICOE: My Lords, I beg to move that the Air Force Act, 1955 (Continuation) Order, 1963, be approved.
Moved, That the Air Force Act, 1955 (Continuation) Order, 1963, be approved.—(Earl Jellicoe.)
On Question, Motion agreed to.

ARMY ACT, 1955 (CONTINUATION) ORDER, 1963
EARL JELLICOE: My Lords, I beg to move that the Army Act, 1955 (Continuation) Order, 1963, be approved.
Moved, That the Army Act, 1955 (Continuation) Order, 1963, be approved.—(Earl Jellicoe.)
On Question, Motion agreed to.

ELECTRICITY AND GAS BILL
Brought from the Commons; read 1a, and to be printed.

PLANT VARIETIES AND SEEDS BILL [H.L.]
2.57 p.m.
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—(Earl St. Aldwyn.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD MERTHYR in the Chair.]
Clause 1 agreed to.
Clause 2 [Conditions for grant of rights]:
LORD AMHERST OF HACKNEY LORD AMHERST OF HACKNEY moved to add to subsection (3):
"Provided that the restriction imposed by paragraph 2(1) of the said Part II shall not apply to the offer for sale or sale of any plants or material forming part of or derived from any plants during the period commencing 12th November, 1963, and ending on the day on which the fifth scheme to be made by the Ministers under this Part of this Act comes into force".
The noble Lord said: Your Lordships will be aware that the position of the breeder of a new variety at the moment is that he has no protection at all. When this Bill comes into force, and when a scheme has been produced for that variety, the breeder will be able to register the variety, to issue licences and to collect royalties. The object of this Amendment is to deal with the period between the introduction of this Bill and the coming into force of a scheme under the Act.
As your Lordships will know, if any variety has been offered for sale the breeder is automatically disqualified from applying for registration when the scheme comes in. There are at the moment a number of varieties ready for commercial sale. Immediately, therefore, the breeder is put in the position of having to decide whether to go ahead and sell the variety, in which case he automatically forfeits any rights he will have under this Bill, or whether to hold the variety off the market until the Bill becomes law and the scheme is produced. On the whole,
1112
the more valuable the variety the greater will be the chances of remunerative royalties, and therefore the more incentive there will be for the breeder to hold the variety back off the market. This applies not only to our own breeders but, in the case of imported varieties, to agents who are acting for breeders abroad.
I think all your Lordships will agree that it is important that new varieties which give improved yields should come into commercial production at the earliest possible moment and should not be held back waiting for the passage of this Bill, so possibly depriving the farmers or horticultural growers of the variety for, maybe, up to a year; because to put a variety on the market is quite a long process, and for a wheat coming in next autumn it would have to be started early in the spring. This Amendment is a purely temporary provision and is to apply only until Her Majesty's Government produce the fifth scheme under the Act. This may seem a rather odd provision, but the reason is that when Her Majesty's Government have introduced the fifth scheme they will then be in a position to ratify the International Convention. It is probable that once that has been done a scheme of this nature would be contrary to that Convention. Therefore I ask the noble Lord to agree with me that this raises an important point, and I hope he will be able to give me a helpful reply. I beg to move.
Amendment moved—
Page 2, line 36 at end insert the new proviso.—(Lord Amherst of Hackney.)
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (LORD ST. OSWALD): I apologise to my noble friend for mistiming by a minute my entry. I had been given to understand that the Committee stage would begin a little later. I think I have followed the whole of his argument presented to-day in favour of his Amendment and I am impressed by it. What he is suggesting, I think, is that as a result of the Bill as it stands there may be a pause in the introduction of new varieties. The Bill now before your Lordships will invest the plant breeding world with an element of certainty, which it has long asked for, and, I hope, of confidence. But the terms of the Bill, being an enabling Bill, cannot, of course,

1113
spell out that certainty beyond a given point of detail. I cannot in fact say what schemes relating to which crops will be the first to be laid, nor upon which dates.
Consequently, this element of certainty of which I have spoken is, as my noble friend pointed out, a qualified certainty. Breeders are faced—and we see this—with the dilemma of whether to go ahead with marketing their new varieties without waiting for the Bill to reach the Statute Book, or of withholding them until the schemes have been made under Part I enabling them to submit an application for the grant of rights. My noble friend is perfectly correct in saying that.
As the Bill stands, marketing before a scheme comes into force would rule out a subsequent grant of rights, and the Amendment moved by my noble friend is designed to ameliorate this by allowing a variety to be sold at any time from the publication of the Bill—that is the twelfth of last month onwards—without invalidating the subsequent application for rights. In an effort, which I assume is to meet the Government's difficulties, and which I appreciate, my noble friend does not propose a blanket exemption; he proposes that the concession should be limited to varieties covered by the first five schemes made by Ministers under Part I of the Bill. This, I can also appreciate with my noble friend, is not simply to the advantage of plant breeders, but also to the advantage of agriculture as a whole, in that whether a new and improved variety may be available as from now, efficient farmers should not be obliged to wait a season longer than they need.
Knowing him as I do, I am sure that my noble friend will accept that the wording of his Amendment will require rather more careful examination than I have so far been able to give it. There are certain problems to consider—for example, it would seem only fair that a producer of a new variety of seed during this period before the scheme should be warned that the breeder might later be applying for rights, and that this obligation to inform and to warn should be laid upon the breeder.
There is yet another point which concerns the position of those growers and merchants who acquire supplies of seed
1114
for plants in the prior marketing period. Are they to have a prescriptive right to a licence from the breeder, when in due course he is granted rights in the variety? I hope that what I have said will give an indication of my sympathy with my noble friend's purpose, and subject, therefore, to consideration of the points which I have made and others which may emerge, I hope to find it possible, if my noble friend agrees to withdraw his Amendment, to introduce an Amendment at a later stage to achieve the main object which he has in mind.
LORD AMHERST OF HACKNEY: I am extremely grateful to my noble friend for the way he has received this Amendment. I realise that there are considerable difficulties over it, and I certainly have great pleasure in withdrawing it.
Amendment, by leave, withdrawn.
Clause 2 agreed to.
Clauses 3 to 15 agreed to.
Clause 16:
Seeds regulations
16.—(1) The Minister, after consultation with representatives of such interests as appear to him to be concerned, may by statutory instrument make such regulations as appear to him to be necessary or expedient for the purpose—
(e) of prescribing anything which, under this Part of this Act, is authorised or required to be prescribed,
and regulations under this section shall be known as seeds regulations.
3.6 p.m.
LORD WISEhad given Notice of two Amendments to Clause 16, the first being in subsection (1)(d), to leave out "and", and the second to insert at the end of paragraph (e):
"and of preventing the sale of seeds of a type or variety which will produce plants of an inferior quality, or of seeds infected with disease."
The noble Lord said: I beg to move the first of the two Amendments standing in my name. May I suggest to your Lordships that we take the Amendments together? The first Amendment is simply drafting in relation to the second Amendment. Clause 16 deals with the regulations which are to be attached to the sale of seeds. Under this clause Ministers may make regulations by statutory instrument after consultation with interested parties. I understand

1115
that certain consultations have already taken place with interested parties in regard to this particular Bill. Possibly the Bill has been drafted as the outcome of some of those consultations.
This particular clause deals with five points. The first is for
"ensuring … reliable … information … as to the nature, condition and quality of seeds which are being sold".
The second is for:
"preventing the sale of seeds which are deleterious, and of preventing the sale of seeds which have not been tested for purity and germination, or which are of a variety the performance of which has not been subjected to trials".
The third is for:
"preventing the spread of plant disease by the sale of seeds."
Next, there is the regulating of descriptions under which seeds are sold; and lastly, of prescribing anything which the Minister is authorised to prescribe.
So far as I can see, the particular point which I have to raise is not covered by subsection (1) of that particular clause. The Minister may say in reply that the clause as it stands fully covers every conceivable point which may arise in the sale and quality of seeds. But it omits reference to low-grade seeds which are likely to produce plants of an inferior quality, or of seeds already infected with disease. These are two most important categories, and I hope that the Government will take notice that they are omitted from this particular clause.
We have to guard against defects of this sort. There is nothing worse than seeing a field of inferior plants, which may not be due to the poorness of the soil but may be the result of bad seed, or perhaps partly due to diseased seed. In the future, in which we must strive to produce first-class crops of high quality and purity, we cannot afford to tolerate any subversive action by any seed grower or merchant, whether here or overseas, in the supply of inferior seed. If my Amendment fails—and I hope it will not fail—the farmer can be subjected, without redress, to the passing off to him of something which will not be apparent until the time arrives, if and when it does arrive, when the plants show themselves well above the ground.
1116
This should be avoided if, as we hope, farming is to increase its already high efficiency. I beg to move.
Amendment moved—
Page 16, line 2, leave out ("and").—(Lord Wise.)
LORD ST. OSWALD: I am grateful to the noble Lord for taking together these Amendments on interrelated subjects. I thought that he would find it to his convenience as well as that of the Committee to do so. The Amendments make it clear, as does his speech, that he accepts the view which I expressed on Second Reading that any widening of the powers to control imports of seeds conferred by Clause 24 would entail a corresponding power to limit the marketing of home-produced seeds, if we are to meet our obligations under GATT. It seems to me that this Amendment was intended to pave the way to Amendments 4 and 5 to Clause 24. To my regret, in view of the personality of the noble Lord who is moving them, I do not feel able to accept these Amendments, collectively or singly. It appears to me that they stand or fall together, and we do not feel able to accept them.
The Amendment to Clause 16—and a good deal of what I have to say on this Amendment applies equally to the first of the proposed Amendments to Clause 24—appears to raise in a modified form the proposal for a restricted list of authorised varieties. This, for the reasons I explained in my reply to the noble Lord on Second Reading, is in conflict with the normal principles of our seeds legislation. This is, as a general rule, to ensure that the farmer is given as much reliable information as possible about the seeds which he is buying, but the final choice is left to him.
In the case of seeds infected with disease, we already have the necessary powers to prevent the spread of plant disease by the sale of seeds, by means of plant health legislation and, where this may not apply, under the terms of the present Bill. In this connection I would draw attention to subsection (1)(c) of Clause 16, but in relation to the sale of inferior types of varieties we prefer to rely on the powers conferred by Clause 22. Whether we say that only varieties which pass a test of merit may be marketed, or those which

1117
fail to satisfy certain criteria should be prohibited, in practice amounts to much the same thing. To require the performance testing of all varieties of every crop, in order to ascertain which of them might be inferior to others, would place too great an onus on the trials organisations, but this logically is what the noble Lord's Amendment would entail.
We must be selective in this, and I trust the noble Lord will agree that the powers conferred by Clause 22 effectively meet the case. This will enable the Ministers to make orders requiring performance trials of certain new varieties (this is where selectivity comes in) and the publication of a report before they are put on the market. In this way I feel sure we shall achieve what we have in mind without recourse to the straitjacket of restricted lists of varieties in every crop which either may or may not be sold in this country.
LORD WALSTON: I was a little disappointed, listening to the Minister's reply to my noble friend's Amendment, for he did not seem to be answering precisely what the problem was. I agree entirely that if this Amendment made it incumbent on the Minister to have a prohibited list of certain seeds which could not be sold that would put the industry into too much of a straitjacket. But Clause 16 says:
"The Minister, after consultation with representatives of such interests as appear to him to be concerned, may by statutory instrument make such regulations …"
—not "must" or "shall", but "may". Therefore, even if my noble friend's Amendment were adopted, the Minister would not be forced to prohibit certain varieties of seeds: but he would only have the power to do so if it seemed to him, after due consultation, to be right that it should be done.
This is not simply a question of each individual farmer's wishes. Of course, if some farmers prefer to go in for a type of seed which is susceptible to disease because they think the quality or yield, whatever it may be, worth the gamble, one could say: "Why should they not be free to do so?" But when it is a question of disease, and particularly disease in potatoes, since it can spread rapidly to one's neighbour, one is not taking a gamble just with one's
1118
own crop but also with one's neighbour's crop. I feel that the Minister, while not being forced to prohibit such things, should at least have under this Bill the power to prohibit, if, after consultation, that seems desirable. The Minister's argument was directed more against its being compulsory on the Minister to do it rather than permissive. I therefore hope that he will reconsider his rejection of my noble friend's Amendment and look into it in rather more detail.
VISCOUNT STONEHAVEN: As the question of potatoes has been raised, I should like to point out that the seed of a potato is not the thing which is commercially sold. In point of fact the potato is a split plant, so that I do not think it is covered. I would also point out that a more superior type of seed which may well succeed in good land may fail utterly where the conditions are more difficult. Therefore, although I sympathise with the feeling behind this Amendment, I support the Minister entirely in his contention that it would be very dangerous indeed to clamp on a straitjacket of this type. It might have the reverse effect to that desired.
LORD ST. OSWALD: I am happy to have the support of my noble friend Lord Stonehaven. At the same time, I sympathise with the noble Lord, Lord Walston. It may be that I put too much emphasis on the aspect of Lord Wise's argument which referred to the obligation on the Minister to take this action, but in fact we feel that it would be wrong, and certainly out of step with existing seeds legislation, to enable a Minister to prohibit the sale of a certain type of seed and to extend this over the whole field of agriculture. It may be that we can do more than we are doing to extend our information and advice. I should like to look at this. But we seriously think that where advice is given and a farmer reads this advice, as every farmer is free to do, this should be sufficient to prevent him, to dissuade him, from using inferior seed. Of course as regards diseased seed, as I explained to the noble Lord, we have measures to prevent its sale.
LORD WISE: I am rather disappointed with the Minister's reply, but what am I to do? At the moment the matter is

1119
a draw, 2—2. I did hope that the Minister would take it back and think it over again; but, if not, then I must ask to withdraw the Amendment.
Amendment, by leave, withdrawn.
Clause 16 agreed to.
Clauses 17 to 23 agreed to.
Clause 24 [Control of imports of potentially deleterious seeds]:
3.22 p.m.
LORD WISE: May I deal with Amendments Nos. 4 and 5 together? Amendment No. 4 deals primarily with the importation of seeds. It is tied up with the control of imports and, as the Minister said in reply, it bears some relation, of course, to the previous Amendment which I moved. This is an important clause, as it is important that we should stop the importation of bad seeds. My Amendment seeks to do this, and I hope that in this case the Minister will be able to accept it. The clause as it stands does not appear to me to be strong enough and further additions should be made. Again, my Amendment prohibits the importation of seeds from any country. The clause simply prohibits the importation of seeds from countries with different climates, different hours of daylight or other different conditions. I think it is important that, not only should we deal with countries such as these, but we should deal with countries where we might be able to obtain the same classes of seeds as we produce in this country, or as we wish to grow. Therefore I hope that in this case the Minister will be able to meet our wishes. I beg to move.
Amendment moved—
Page 25, line 42, leave out second ("or").—(Lord Wise.)
LORD ST. OSWALD: I think I can speak to this Amendment rather briefly without discourtesy to the noble Lord, because I did make reference to it in what I said on the earlier Amendment. As regards seeds which are infected with disease, powers already exist to control their import under our plant health legislation, and it is for this reason that there is nothing in Clause 24 of the present Bill. Furthermore, we have the
1120
power under subsection (3) (c) of Clause 16 of the present Bill to prohibit the sale of seeds, whatever their origin, which contain more than a certain proportion of any weed seeds, noxious or otherwise. This is of course a fairly strong form of protection. I do not know whether the noble Lord had noticed it in reading through the legislation. To this extent the proposed Amendments to Clause 24 appear unnecessary.
On the general issue of principle, I would refer the noble Lord, Lord Wise, to what I said in regard to his Amendment of Clause 16. While we feel justified in taking special powers to prohibit the importation of certain types or varieties which can lead to the deterioration of our domestic strains by admixture or cross-pollination, or which are patently unsuitable to this country because of their different climatic origins, we do not feel justified in taking general powers to prohibit the importation of types or varieties which are not in themselves harmful. As I said before, to ascertain whether a given variety is in some undefined way inferior to other varieties, we should have to submit all new varieties coming on to the market, whether imported or of domestic origin, to merit tests—a most onerous procedure and one which would undoubtedly be opposed by the whole seed trade.
We are certainly prepared to consider how the arrangements for advice—and this again reflects something I said earlier—could be extended and improved, but in general we are convinced that the method of requiring certain detailed information to be given to a purchaser under seeds regulations is the right one, supplemented as it is, and increasingly will be, by reports from advisory organisations as to the performance of different varieties under United Kingdom conditions. I would suggest to the noble Lord that, of course, most varieties which are most likely to be used extensively in this country are submitted to performance tests, and the results of these performance tests are published for the benefit and information of farmers who may be using them.
LORD WISE: In view of what the Minister has said, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
LORD WISE LORD WISE moved, in subsection (7), after paragraph (a) to insert:
"() may include provision as to methods by which importers may be required to mark consignments of seeds, by the staining of a proportion of such consignments or otherwise, in order to indicate the country or source of origin of the seed".
The noble Lord said: This is another Amendment on the importation of seeds to which the clause refers, but there is a slightly different proposition here to which I wish to call the attention of the Minister. The order of prohibition under this clause includes two provisions which are to be found on page 26, in subsection (7). The first is a provision by which the importers may be required to prove whether consignments are satisfactory. The second provision covers the form and manner of applications for licences. The Amendment which I wish to move is to include a provision covering the
"methods by which importers may be required to mark consignments of seeds, by the staining of a proportion of such consignments or otherwise, in order to indicate the country or source of origin of the seeds."
I understand that the staining of seeds is in vogue in various countries. I think it is in vogue in three Commonwealth countries, in three European countries and in the United States of America. The practice is to stain a proportion of a consignment of seeds with certain dyes and the staining appropriate to the country of origin of the seeds is approved by the merchants or importers. It seems to us to be a very sensible arrangement—one which is adopted overseas—and we hope that the Minister will accept this Amendment in order that this practice may be brought into operation in this country as we think the system could be advantageous to us. I beg to move.
Amendment moved—
Page 26, line 38, at end insert the said subsection.—(Lord Wise.)
3.30 p.m.
LORD ST. OSWALD: I followed the noble Lord, of course, with my usual care, but I still do not see how this provision or this obligation could be advantageous to us The purpose of Clause 24 as it stands is to enable Ministers to prohibit entirely the import of seeds which are potentially deleterious. That being so, I find it difficult to see the justification for the
1122
staining of imported seeds, which of course are not necessarily inferior just because they are imported. On the contrary, they are often of very high quality, and they have made a great contribution to the agricultural industry of this country. In any case, our seed regulations require that when seeds are sold a statement should be made as to their origin. Thus, even without staining there can be no doubt as to their origin, and to require, in addition, the staining of imported seeds is, in the view of the Government, unnecessary and might even be regarded as discriminatory, which of course we should regret. Naturally, I should like to be more helpful and more amenable to the noble Lord, but, having considered his Amendment, and having listened to his speech, we cannot see in what way his proposal would help the farmers of this country.
VISCOUNT STONEHAVEN: I should like to support the noble Lord, Lord Wise, in this Amendment, and I would mention perennial rye grass, which is grown extensively in Ireland. The crop has been grown there for the purposes of seed for a long period, and they have developed a strain which is very prolific in seed but nothing like so prolific in pasture, which is what the farmer who buys the seed wishes to grow. That rye grass is a perfectly good perennial rye grass, but it is vastly inferior to some of, say, the Danish strains, and many others. If it were stained it would, on the one hand, encourage the Irish to improve their seed very considerably, and, on the other, it would readily prevent that seed from getting mixed with other seeds. Three or four foreign countries, including America, have for a long time found this system efficacious, and I cannot see why our own Ministry should not have a close look at effective methods used overseas. I should like to support the noble Lord, Lord Wise.
LORD ST. OSWALD: My noble friend Lord Stonehaven has suggested a by-product of the Amendment moved by the noble Lord, Lord Wise. But I wonder whether he appreciates that this Amendment would require the staining of all foreign seed, not merely a particular seed from a particular foreign country. It seems to us to be a very extravagant method by which to

1123
encourage any given country to improve any particular seed they might be producing.
LORD WISE: I wish the Minister would look at this again, because I have received very substantial backing from the other side of the House, which I appreciate. This particular system is in vogue in other countries on very satisfactory lines; and if they can carry out the system there I do not in the least see why, if it is likely to improve our knowledge of the importation of seeds, and be to our advantage, we should not put it into use. I hope that the Minister will have another look.
LORD ST. OSWALD: It is understandable that the noble Lord, Lord Wise, should have been encouraged by what my noble friend behind me has said, but, in fact, his reference was to North Irish seed, which does not count as imported seed; so that in any case that seed would not be stained. The example which my noble friend chose, therefore, does not in fact help the purposes of the noble Lord, Lord Wise. But I will certainly look at it again, as the noble Lord has urged me to do so. After what I have said, the noble Lord will understand that I obviously cannot give him any particular promise, but I am attracted by the way he has argued his case, and perhaps either we can have a word privately between now and the next stage of the Bill or he can take such further action as he wishes. But it would be wrong and dishonest of me, I think, to encourage him to think that we should be able to achieve anything.
VISCOUNT STONEHAVEN: I must just point out that, besides the six Northern Counties, there is another part of Ireland where they also grow grass.
LORD ST. OSWALD: I thought my noble friend referred to the Northern Counties.
LORD WISE: Having gained that knowledge about Ireland, I beg leave to withdraw the Amendment, on the understanding which the Minister has given.
Amendment, by leave, withdrawn.
Clause 24 agreed to.
House resumed.

ARABS AND BRITISH TRADE WITH ISRAEL
3.37 p.m.
LORD CARRINGTON: My Lords, with your permission I should like to give your Lordships a statement which is being made in another place, and at the same time to answer the Private Notice Question which the noble Earl the Leader of the Opposition put to me earlier this afternoon.
Her Majesty's Government strongly disapprove of pressure from any source on British firms to discriminate between British subjects on any grounds. We have made our views known to representatives of the Arab Embassies in London. In doing so, we have expressed our disapproval of action by these Embassies designed to bring pressure on British firms to comply with the Arab boycott of Israel, and we have said that we hope these practices will not continue.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, I am obliged to the noble Lord for giving us this statement. May I ask whether the whole of the Arab peoples were represented by the representatives who happened to visit the Foreign Office yesterday? Whom did they represent—which countries?
LORD CARRINGTON: Yes, my Lords, they were representing all the Arab countries, and they were the Ambassadors of Iraq, Saudi Arabia and Libya.
EARL ALEXANDER OF HILLSBOROUGH: I think the noble Lord himself saw them. Did they mention what they said on the television: that they considered themselves in a state of war with Israel? Did they repeat that? Could we know what was the comment of the British Government on that?
LORD CARRINGTON: My Lords, that was one of the things that was said to me. I did not see the television interview, so I cannot judge whether the same words were used; but I think that has always been the position of the Arab countries, and we have always said that we take no sides in the matter.
EARL ALEXANDER OF HILLSBOROUGH: The statement made on behalf of Her Majesty's Government, of

1125
course, gives the proper position in relation to our trade and commerce in the Middle East. I should like to know whether the noble Lord expects an early reply from the central Governments of the countries which were represented, and, if they do not propose to depart from this kind of practice but repeat it in other instances, what action the Government propose to take.
LORD CARRINGTON: My Lords, do not think a reply is called for. What we have done is to express our grave disapproval of what has been done in the past. This we have done, and I am confident that the Arab Governments will take account of our views.
EARL ALEXANDER OF HILLSBOROUGH: I hope that may be so. Good friendships have been established in many ways between this country and the Arab world in trade and commerce, which I take it are working both ways, and we ought not to have our British trade and commerce interfered with in such a manner when there is at least an armistice agreed to, under the influence of the United Nations, between the countries concerned. There ought to be no interference with commerce in any way at all.
LORD CARRINGTON: I think, my Lords, that if the noble Earl reads the statement he will see that Her Majesty's Government agree with him.
LORD REA: My Lords, may I ask the noble Lord whether, if there should be any further reactions arising out of his conversations, he will inform your Lordships' House? And might I also say that I think it is probably the sense of this House that they view with great gratification the dignified manner in which this matter was treated by one Member of your Lordships' House who was involved in this rather humiliating situation?
LORD CARRINGTON: My Lords, I will certainly do that; and I am sure that my noble friend will be grateful for the words which have been spoken.
LORD SILKIN: My Lords, is it not possible to give a more positive lead to the 80 or so British firms who have been treated in this way, and who have been asked for detailed information about their business and the people they employ? If the Government could give
1126
some positive lead to these firms and encourage them to refuse to give this information, I am sure it would be of great help.
LORD CARRINGTON: My Lords, I should have thought that the statement that I made and the statement that was issued by the Foreign Office last night made the Government's view perfectly clear; but of course it is for a firm to decide, in the light of its own interests, what it should do.
LORD MORRISON OF LAMBETH: My Lords, may I raise a point which is related to this? This is the injury to British trade with Israel by the fact that Egypt refuses to let British or other ships go through the Suez Canal if they are destined for Israeli ports; and they similarly bar Israeli ships. This came up at the United Nations but nothing effective has been done. Moreover, this is not a question of there being a state of war, because I believe that consideration was, if I remember rightly, excluded by the treaties concerned. May I ask whether the Government are doing something vigorous and effective to restore the right of freedom of traffic through the Suez Canal?
LORD CARRINGTON: My Lords, I think that is rather wide of the statement I have made; but if the noble Lord would like to put down a Question I will do my best to answer it.
THE EARL OF LONGFORD: My Lords, may I venture to disagree with the implications of an answer by the noble Lord the Leader of the House? He said that in cases of this kind it is entirely the option of the firm to decide what to do according to its own interests. Legally, that is the position; but I should hope that the Government in this situation would indicate what they thought to be the duty of the firm; and I should hope that the Government would have deplored the attitude in this case of the firm which has behaved in a shocking way.
LORD CARRINGTON: My Lords, I do not think there is anything between the noble Earl and myself. All I said was that I thought we had made the position of Her Majesty's Government quite clear: that we have no standing in the matter. It is up to the firm to decide what it wants to do itself.

PLANT VARIETIES AND SEEDS BILL [H.L.]
3.43 p.m.
Committee stage resumed.
LORD WISE LORD WISE moved, after Clause 24, to insert the following new clause:
Powers of the Minister to prevent deterioration through cross-pollination
".—(1) The Minister may, after consultation with such bodies as appear to him to represent the interests of seed growers and of seed merchants, make such regulations by statutory instrument as appear to him to be necessary and expedient for the purpose of ensuring, so far as is practicable, that the trueness to variety of seeds produced from plants grown for seed should not be endangered or suffer deterioration by the cross-pollination of those plants by other plants.
(2) Such regulations may in particular provide for the definition of zones and the Minister may serve notice in writing on any person who occupies land within such a zone requiring him to remove or destroy any plant, of a type or variety specified in the regulations, that is growing on that land.
(3) Any person who within 48 hours of the receipt of such a notice as is referred to in the foregoing subsection fails to comply with the requirement stated in the notice shall be guilty of an offence and shall be liable on summary jurisdiction to a fine not exceeding £20."
The noble Lord said: I rise in this instance to the attack with more confidence, after what the Minister promised me in regard to the last Amendment. The Amendment that I seek to move now is for the insertion of a new clause after Clause 24. The Amendment falls into three parts. The first says:
"The Minister may, after consultation … make such regulations by statutory instrument as appear to him to be necessary and expedient for the purpose of ensuring, so far as is practicable, that the trueness to variety of seeds produced from plants grown for seed should not be endangered or suffer deterioration by the cross-pollination of those plants by other plants."
We have dealt with the importation of seeds. This clause deals with plants which are growing and may in various ways come into contact with plants on adjoining land which may be pure. The first stage is one of protection of pure seed; the second stage in my Amendment deals with the establishment of areas in which such seeds are grown; and the third stage with the penalty which may be imposed on a grower who
1128
has not complied with an order from the Ministry.
First of all, let me say a word or two about the first portion. I want to say at this point that the seeds industry are very much in favour of the insertion of this particular clause into the Bill. It seems to me an essential principle of keeping all seed stocks pure and preventing those seed stocks which are pollinated by insects or wind from being adulterated by neighbouring crops of the same species, but of other varieties, which are in flower at the same time. That is more or less what I said a moment ago. The particular point which I am making has been very much stressed by the influential Committee which, as no doubt the Minister knows, considered the question of the seeds industry; and they are pretty emphatic that some particular zone should be set up whereby seeds could be kept pure.
The second portion of my Amendment deals with the question of a notice by the Minister, who can serve notice on a person
"who occupies land within such a zone requiring him to remove or destroy any plant, of a type or variety specified in the regulations, that is growing on that land."
That is, if that particular plant is obnoxious to other plants growing nearby. That seems to me a very reasonable provision; and if the person who has received notice does not carry out what he is required to do within 48 hours he is liable to a penalty in the ordinary way. I hope that the Minister will accept this because I want to stress particularly in his mind that the industry is anxious that these provisions should be put into operation.
Amendment moved—
After Clause 24, insert the said new clause.—(Lord Wise.)
LORD ST. OSWALD: I have listened with interest and a good deal of sympathy to the plea advanced by the noble Lord, Lord Wise, and I can understand why he can feel more confident in this than in the earlier Amendment. He wishes the Minister to take power in this Bill to assist the seed production industry to deal with what is the difficult problem of cross-pollination between different varieties and different species of plants. Unless adequate distances are maintained between the different seed

1129
crops, as much as 1,000 yards in some cases, there is a real risk that the wind, or bees and other insects, may carry pollen at the flowering stage from one seed crop to another, with the result that some proportion of the seed may later be found to be not true to variety or type, through no fault of the grower himself. This is the noble Lord's point and it is valid. Off-types will become apparent only in the following crop, by which time the seed may have been widely distributed to farmers and in some cases exported.
The production of seed true to type and variety is the responsibility of the seed growers and contracting merchants, with the Government encouraging, advising and assisting, for example through voluntary certification schemes whose aim is the production of authentic seed. It has, however, been represented from time to time that growers and merchants were finding it increasingly difficult in some areas to select suitably isolated fields for seed production. Even after contracts have been signed, the arrangements can be disorganised by changes of cropping plans on the part of other growers in the vicinity, and even by the neglect of gardeners and allotment-holders, in allowing their unused cabbage or other crops to run to seed. The problem is essentially one of satisfying competing claims for the available land.
As the noble Lord has pointed out, the Committee on Transactions in Seeds examined this problem and reported in favour of conferring powers on Ministers to intervene when voluntary efforts had failed to safeguard the purity of seed crops. The Committee proposed that the seed production industry should first get together and prepare zoning schemes, where particular districts or other areas were allocated to particular seed crops, so arranged as to avoid cross-pollination. This is already done on a voluntary basis in the major seed-producing counties (I am thinking of Lincolnshire, East Anglia and Essex), and the Committee even proposed that the Minister could be called in to put such a scheme on a compulsory basis, with power to deal with offending crops which spoilt the careful arrangements made in the scheme. This is substantially the main purpose of the noble Lord's new clause, although it goes a
1130
good deal wider by giving the Minister a general power of regulation.
I believe that there is much in what the noble Lord has said about the difficulties of seed production in certain crops, and certainly in what he said about the importance of varietal pure seed in crop production. I should, however, like him to consider what he is suggesting (if he follows the zoning proposal to its logical conclusion) that the Minister should be empowered to do. He is asking, in the first place, that the Minister should be able to impose a particular pattern of cropping on farmers within a zone, affecting not only the seed producers themselves, most of whom may perhaps be in favour of the scheme, but farmers growing other crops, from which they may wish at some time to take a seed crop. Where, at the present time, persuasion must be used by the grower or the merchant to secure the removal of seeding plants which do not fit into the plan, under the proposed new clause, this duty will devolve on the Minister and it will be a criminal offence to disregard the Minister's regulations. We should, I suggest, hesitate to replace voluntary methods by such drastic powers, unless it is clear that voluntary methods have seriously broken down. I do not think that the noble Lord has suggested that this is the case, although I recognise that there may be difficulties.
The matter does not end there, where the noble Lord leaves it. Another source of cross-pollination is the casual seed crop taken by the allotment grower and the neglected plants in the cottage garden. These also must be destroyed or removed, and it would not, I think, be sufficient to provide for the imposition of a fine, if the Minister's direction was ignored. The fine would not prevent cross-pollination. The damage would have been done. A power of entry would be required by the Ministry's inspector, together with a power in the last resort to destroy or remove the offending plants.
I recognise the seed-growing industry's problem, and I appreciate their difficulties in this matter of cross-pollination. It is, however, clear from what I have said that the remedy proposed by the noble Lord, Lord Wise, in the new clause now before the Committee, raises considerable difficulties of enforcement,

1131
and I fear that, if it were accepted, we should be running the risk of weakening the industry's determination to seek its own self-evident advantage by mutual agreement. It is, I believe, unusual for farmers or gardeners to refuse their co-operation when the needs of seed production are pointed out to them. After all, the breeding of the best seed is for their eventual benefit. Therefore, I recommend to your Lordships that we should continue to place reliance on voluntary arrangements and the power of persuasion. I wonder whether the noble Lord, Lord Wise, in thinking out his Amendment, as he has most carefully done, realised, with all his care, what it would require in terms of enforcement.
LORD WISE: I appreciate the long explanation which the Minister has given, and which I am certain will be read with interest, not only by me but also by members of the seed industry throughout the country. In view of what the noble Lord has said—no doubt there are difficulties—I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
Clauses 25 to 37 agreed to.
Clause 38 [Extension of Act to Northern Ireland]:
LORD ST. OSWALD LORD ST. OSWALD moved, in subsection (3)(b), at the end of sub-paragraph (iii), to leave out "and" and substitute:
"(iv) after paragraph 3 of Schedule 4 there were inserted the following paragraph—
'3A. In relation to proceedings before the Tribunal in Northern Ireland—

(a) paragraphs 1 and 2 of this Schedule shall have effect as if for the references to the Lord Chancellor there were substituted references to the Lord Chief Justice of Northern Ireland, and

(b) references in paragraphs 4 and 7 of this Schedule to the chairman or deputy chairman shall be construed respectively as references to the chairman or deputy chairman appointed for such proceedings';

and".
The noble Lord said: This is the first of a series of Government Amendments concerned with the provisions for the operation of the Appeals Tribunal to be set up under Clause 10 of the Bill. The purpose of the Amendments is to adapt these provisions as
1132
regards the chairmanship of the Tribunal in relation to appeal proceedings taking place in Northern Ireland or Scotland. The need for these Amendments arises from the fact that the Tribunal may be called upon to deal with cases arising in any part of Great Britain and, when Part I of the Bill is extended or proposed to cover Northern Ireland, in that country also. The Tribunal may sit anywhere in the United Kingdom, and for this purpose the Government consider that it would be desirable for appeal proceedings in each country to be heard under the chairmanship of a suitably qualified member of the legal profession of the country concerned. This will also facilitate any post-Tribunal proceedings on points of law arising in the courts of the country where the Tribunal sat. The appointment of a suitable person as Chairman should, of course, rest with the appropriate legal authority in each country, and the Amendments provide accordingly.
The Amendment to Clause 38, which I am now moving, gives effect to the Government's intentions as regards Northern Ireland. The remaining Amendments in this group, other than those of a purely drafting character, concern proceedings in Scotland and arise on Schedule 4. I beg to move.
Amendment moved—
Page 35, line 34, leave out ("and") and insert the said new sub-paragraph.—(Lord St. Oswald.)
On Question, Amendment agreed to.
Clause 38, as amended, agreed to.
Clauses 39 and 40 agreed to.
Schedule 1 agreed to.
Schedule 2: Part II [Rules for grant of rights]:
3.59 p.m.
LORD AMHERST OF HACKNEY LORD AMHERST OF HACKNEY moved, in Part II, to add to paragraph 2(1):
"Provided that the restriction imposed by this sub-paragraph shall not apply to any sales or offers made in relation to or in pursuance of a contract providing for the production of the plant variety under the control of and for re-sale or return to the person entitled to make an application for the grant of plant breeders' rights or his agent in respect of that plant variety".
The noble Lord said: Schedule 2, Part II, of the Bill deals with the rules

1133
which must be complied with before a variety can be registered. Paragraph 2(1) says that no plants of a variety must be sold or offered for sale before the scheme comes into force, and the object of this Amendment is to exclude certain types of sale.
There are sales in what one might call the multiplication period—that is, when the plants or seeds of a variety are being multiplied prior to sale to the general public. Breeding new varieties is a lengthy process, and I understand that in the case of cereals something like 14 years is quite usual. You start off with many thousands of plants and gradually, by a process of selection, after about seven years you begin to realise that certain varieties are likely to have commercial value. You then want to increase these as quickly as possible and have them tried out under as many types of conditions as you can. So the practice is that this seed, particularly in the case of cereals, is sold to farmers to grow the crop on and sell it back to the breeder. Sometimes it is sold back; sometimes the seed is supplied and then the crop is sold back and the cost of the seed deducted. But in either case, it is a kind of sale, and under the Bill as it stands the breeder would be disqualified from applying for registration of the variety. Therefore, when it was put on to the market, he would not be able to claim variety in it, which this Bill is designed to give him. Even if under Schedule 1 he applies for registration and for protection, he is still barred from selling the seed. Therefore, during this period this process cannot go on.
If some Amendment is not made, it will mean that a large number of growers will either be put out of court by the Bill or will have to try to find some loophole, and this is not very satisfactory. It would also disqualify all those varieties which are at the moment in the process of being developed and are approaching the time when they will be ready for commercial sale. Many of these varieties have been sold in the way I have mentioned, and they would be disqualified. As I have tried to point out, this is something which would cause considerable difficulty to plant breeders and would in many cases be most unfair. I beg to move.
Amendment moved—
Page 40, line 10, at end insert the said proviso.—(Lord Amherst of Hackney.)
LORD WALSTON: I think it is essentially a very common-sense and worthwhile Amendment that has been put forward by the noble Lord, and I hope the Government will look on it with as much sympathy as they did his last Amendment. It does not in any way undermine the principle of the Bill, but simply supports it and makes it much easier for the objectives of the Bill to be put into force. It is not, as some Amendments may have been considered to be, solely in the interests of the seed producers or importers of pedigree seeds, but is in the interests of the proliferator of the seeds—namely, the farmer and the eventual user. I very much hope that we shall hear from the Minister that the Government will accept the Amendment.
LORD ST. OSWALD: I am obliged to my noble friend for his clear explanation of the purpose of the Amendment, and I would say at once to him and the noble Lord, Lord Walston, that it is not the intention to forbid the bulking up of varieties prior to the introduction of the scheme or to the submission of an application for rights on pain of the breeder's losing the opportunity to apply for a grant of rights in due course. I recognise that the breeder may often find it necessary to arrange contracts with growers for this purpose. The terms of various multiplication contracts which are used for this purpose may or may not involve a sale of seed. But I am advised that in some cases performance of the contract may amount to a sale and so invalidate a subsequent application for rights. I agree with the noble Lord, Lord Walston, that an Amendment of this nature would not undermine the principle of the Bill, and, in the circumstances, I accept that a suitable Amendment should be made to the Bill exempting transactions of this kind from the prior marketing restrictions in Schedule 2. If my noble friend would agree to withdraw his Amendment, which I think does not fully accomplish what he has in mind, an Amendment in appropriate form will be introduced at a later stage, and if possible before the Bill leaves your Lordships' House.
LORD AMHERST OF HACKNEY: I am grateful to my noble friend for the assurance he has given, and beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Schedule 2 agreed to.
Schedule 3 agreed to.
Schedule 4 [The Plant Variety Rights Tribunal]:
LORD ST. OSWALD: This is a drafting Amendment, linked with the Amendment to Clause 38 and with the next Amendment to this Schedule. Paragraph 1 of the Schedule is concerned with the appointment of a Chairman for proceedings in England and Wales and, by the application of Clause 38, with the appointment of a Chairman for proceedings in Northern Ireland. The term "advocate" has a Scottish connotation only and is therefore inappropriate in these paragraphs. I beg to move.
Amendment moved—
Page 41, line 31, leave out ("advocate").—(Lord St. Oswald.)
On Question, Amendment agreed to.
LORD ST. OSWALD: This is a consequential Amendment. I beg to move.
Amendment moved—
Page 41, line 44, leave out ("advocate").—(Lord St. Oswald.)
On Question, Amendment agreed to.
LORD ST. OSWALD: This Amendment makes provision with regard to the chairmanship of the Tribunal for proceedings in Scotland comparable to that which has already been made for Northern Ireland by the Amendment of Clause 38. I beg to move.
Amendment moved—
Page 41, line 47, at end insert—
("3. In relation to proceedings before the Tribunal in Scotland—

(a) paragraphs 1 and 2 of this Schedule shall have effect as if for the references to the Lord Chancellor and to a barrister there were substituted respectively references to the Lord President of the Court of Session and to an advocate; and

(b) references in paragraphs 4 and 7 of this Schedule to the chairman or deputy chairman shall be construed respectively as references to the chairman or deputy chairman appointed for such proceedings.").—(Lord St. Oswald.)

On Question, Amendment agreed to.
LORD ST. OSWALD: This is a drafting Amendment. I beg to move.
Amendment moved—
Page 42, line 3, after ("words") insert ("'Any").—(Lord St. Oswald.)
On Question, Amendment agreed to.
Schedule 4, as amended, agreed to.
Remaining Schedules agreed to.
House resumed: Bill reported with Amendments.

HIRE-PURCHASE (No. 2) BILL [H.L.]
4.11 p.m.
Order of the Day for the Second Reading read.
THE MINISTER OF STATE, BOARD OF TRADE (LORD DRUMALBYN): My Lords, in moving the Second Reading of this Bill, I wonder whether your Lordships will forgive a personal reference. I find myself in an unusual position. This is the first occasion on which I have addressed your Lordships, otherwise than in reply to Questions. It is the second maiden speech I have made in this Chamber, for eighteen years ago I made a maiden speech here when this place was "another place". I am sure I am not the first to have made two maiden speeches from these Benches, but I doubt whether anyone else has done so in quite the same circumstances. The last time I made a speech on hire-purchase I was advising another place on behalf of Her Majesty's Government not to accept a Hire-Purchase Bill introduced by a private Member there, because we were then awaiting the report of the Committee set up in 1959 under Mr. J. T. Molony, Q.C., to review the whole field of consumer protection, including hire-purchase. I said then that there would be no undue delay in introducing legislation. The Final Report of the Committee was published in July, 1962, as Cmnd. 1781. To-day I am venturing on behalf of Her Majesty's Government to commend to your Lordships a Bill giving effect substantially to the Committee's recommendations on hire-purchase, which the Government have accepted subject to a few minor amendments and omissions.

1137
The Committee made recommendations over a very wide field. They also suggested an order of priority. They gave first place to the appointment of a Consumers' Council—which has already been set up under the Chairmanship of the noble Baroness, Lady Elliot of Harwood. As a close second they put reform of hire-purchase legislation. For the future there still remain the other changes which the Committee recommended—revision of the merchandise marks legislation, of the law on the sale of goods, and so on.
My Lords, the Hire-Purchase (No. 2) Bill deals with a subject which is of considerable importance in our economy and of direct concern to a great many ordinary people. The magnitude of hire-purchase and other credit-instalment business is demonstrated by the fact that at the end of September the total of instalments outstanding amounted to £934 million. Of this, the largest item, which accounted for £449 million, was private and commercial motor vehicles and caravans. Household goods came next, at £380 million; this category includes both furniture and household appliances like washing machines and refrigerators. And new business is being done all the time; the amount of new credit extended in the twelve months up to September was £785 million. Thus, in this Bill not only are we dealing with transactions which add up to very large totals, but where we lay down requirements affecting new agreements, those requirements will at once affect large amounts.
The basic Hire-Purchase Act in England and Wales is the one passed in 1938 and associated in the minds of many of your Lordships with the name of Ellen Wilkinson. It was amended in 1954, but remains in essence as it was passed. When it came into force, it effected a major social reform; in particular, it dealt with the worst abuses of the "snatch-back", particularly in relation to furniture and other household goods. Over the past 25 years the 1938 Act has proved its value; but experience has also suggested ways in which it could be improved and further areas of trade to which it could well be applied.
Turning to the Bill before your Lordships, may by way of preface, refer to the Explanatory Memorandum, which is perhaps almost long enough itself to
1138
require an explanation? We felt it important with a major Bill of this kind, linked closely as it is with a previous Act, to try to explain how the various provisions of the Bill would change the present position. Yet, despite the fullness of the Explanatory Memorandum, I hope that your Lordships will feel that some additional explanation will not be superfluous. I am afraid that it is bound to be lengthy if I am to deal with the salient points as your Lordships would wish.
The Bill is in five Parts. Part I amends the hire-purchase legislation already in force in England and Wales in two ways: it applies the existing provisions to a wider range of transactions; and it adds further provisions. The first major change (introduced by Clause 1) is to raise the monetary limit for hire-purchase and credit-sale transactions subject to the Act. Since 1954 the Act has applied to agreements under which the hire-purchase price, or in the case of a credit-sale agreement, the total purchase price, did not exceed £300; for agreements relating to livestock there was a separate limit of £1,000. The Bill raises the limit to £2,000 in all cases. Although the relevant provision in the Bill is short, in many ways this is the most substantial chance that it makes, and your Lordships will expect me to say something about it.
The Molony Committee recommended that all consumer hire-purchase transactions should be brought within the scope of the Acts. They themselves considered raising the monetary limit, but they rejected that as likely to produce anomalies; for example, they foresaw that the addition of accessories to a car might just put the transaction over the limit and so outside the Act. In paragraph 469 of their Report, they proposed a definition of "consumer sale", and later they suggested that their definition could be adapted for the purposes of the Hire-Purchase Act. We have found ourselves unable to agree with this recommendation. We believe that the first essential, when a transaction is being negotiated, is that all concerned shall know whether it is, or is not, covered by the Act. The approach adopted by the Molony Committee would not have been satisfactory from that point of view, since it turned on the intention of

1139
the hirer: that is whether he intended to use the goods solely for commercial purposes. Certainly neither the dealer nor the finance houses could know what the hirer's intentions were; indeed, the hirer himself might not know.
By putting the limit at £2,000 the Bill takes in practically all motor vehicles subject to hire-purchase agreements; which is what the Molony Committee were aiming to do. There is no exact limit in terms of the cash price. The limit refers to the hire-purchase price, which depends on the amount of the hire-purchase charges, and those in turn depend both on the amount of any deposit or trade-in and on the period over which the instalments are spread. As a rough guide, where a deposit of 20 per cent. is being made and instalments are being spread over three years, cars with a cash price of rather more than £1,600 will still fall within the limit of £2,000 for the hire-purchase price.
This is, of course, a most important extension of the scope of the Act, and I think it is worth while quoting a few words from paragraph 550 of the Molony Committee Report to show that, having inquired thoroughly into the whole matter, they came strongly to the view that that is what should be done. They said this:
"We consider a substantial extension of the Act to be necessary because we think it wrong that the bulk of consumer hire-purchase in terms of money should be uncovered by legal safeguards in the many respects we have referred to. Motor cars are no longer a luxury and caravans are sometimes a home. Hire-purchase is the only way that many consumers can afford to acquire such possessions. Indeed for a great number of people, unversed in business, the acquisition of a motor car will provide their only experience of hire-purchase. The transaction is too heavily loaded in favour of the owner unless the law intervenes protectively. This was recognised by the Act of 1938. We find it unsound and unacceptable that so high a proportion of consumer trade should now fall outside the ambit of the Act."
It is true that raising the monetary limit will have the effect that commercial and industrial hire-purchase transactions within it will also be subject to the Acts. The Molony Committee were not directly concerned with such transactions. They thought that no harm would be done by the inclusion of such transactions up to a limit of, say, £1,000, which was the limit the Committee
1140
considered. We think that no harm will be done with the limit set at £2,000. We have no reason to believe that any practical problems will arise from including commercial transactions up to that figure.
In our judgment £2,000 is a monetary limit satisfactory for the foreseeable future. But, as the Molony Committee observed, it is the habit of monetary limits to get out of date. We have therefore included in the Bill a power to make further increases by Order in Council, subject to approval by both Houses of Parliament.
The raising of the limit would make the safeguards contained in the Hire-Purchase Act apply much more widely. What are these safeguards? First, there is the restriction on repossession of the goods by the owner if the hirer falls behind with his instalments. Once the hirer has paid in depositt or trade-in, if any, and in instalments more than one-third of the hire-purchase price, the owner cannot repossess the goods except under a court order. When considering an application for repossession, the court may take one of several courses. Depending on its assessment of the facts and prospects, the court can make an order for repossession of all the goods; or it can make such an order, suspended on conditions as to payments to be made by the hirer, which in effect allows the hirer longer to pay; or it can make an order under which part of the goods are to be repossessed by the owner and part are to become the property of the hirer.
The second basic safeguard of the 1938 Act is that if the hirer wishes to terminate the agreement and return the goods, he may do so provided he makes up what he has already paid to half the hire-purchase price, or pays all the instalments due to date if they amount to more than half the hire-purchase price. The effect of this provision is that both parties know or can readily establish from the terms of the agreement what the hirer's maximum liability is at any time during the life of the agreement. This is a simple and workable provision. As the Molony Committee said of it,
"in the vast majority of instances justice will be done".
An alternative had been proposed to them—the so-called "true measure of damages" clause, which was included in

1141
the Bill introduced in another place. The Molony Committee considered it but preferred the simpler restriction in the existing Act which I have just described. In paragraph 548 of their Report they wrote this:
"In theory a more equitable result would be achieved by restricting the owner's right of recovery to the hire-purchase price less money received from the hirer and the value of the goods retaken or returned. Such a provision would inevitably lead to disputes as to whether the true value had been obtained on realisation, with subsidiary issues as to the necessity to spend money on repairs, etc."
Having dealt at some length with Clause 1 of the Bill, I hope that I may now pass more quickly over some of the other changes.
LORD LUCAS OF CHILWORTH: My Lords, I do not know whether a Minister in a maiden speech presenting a Bill to your Lordships' House is immune from being interrogated about it. From nods of assent from other noble Lords I see that I may ask a question. Before the noble Lord leaves this point—and I am following his argument very closely—would he please explain for what reason there is inserted in the first part of this Bill, which, as the noble Lord says, is the important part, a provision that if a hire-purchase agreement for goods up to the value of £2,000 is signed in premises other than business premises the purchaser or the hirer of the goods has a right of four days in which he can repudiate his agreement, whereas if he signs a hire-purchase agreement at business premises the agreement sticks? In other words, if I buy a £2,000 car at a showroom, one part of this Bill says that I cannot get out of the agreement, and another part, Clause 3, says that if I sign it in ray house I have four days to get out of it. Why is there this distinction?
LORD DRUMALBYN: My Lords, I was coming to that point. I have dealt so far only with the most important clause, Clause 1, and not with Part 1. I was hoping to come to Clause 3 in a moment.
The Molony Committee were concerned about the problem of the man who commits himself to a hire-purchase agreement without realising that he is doing so or without realising what his obligations would be. Sometimes, they said, he was deceived or misled; sometimes
1142
he misled himself; sometimes he did not read or did not understand the document to which he put his signature. What the Molony Committee felt, however, was that action should be taken on the most fundamental point—the case where a consumer fails to appreciate that the document he is signing is a hire-purchase agreement. (For example, he may be told by the salesman that the document is no more than a receipt for goods to be supplied on approval.) They suggested that there should be a requirement that the hirer's signature to an agreement should be in a special place, a "box", in which would be clearly printed words to the effect that the hirer realises that, by his signature, he is offering to commit himself to a hire-purchase transaction. Clause 2 of the Bill gives effect to this recommendation. It empowers the Board of Trade to prescribe by regulation what the precise wording shall be and how the necessary prominence shall be achieved.
Clauses 3 to 7 provide the consumer with an opportunity to reflect and to change his mind if he has put his signature to the form of agreement anywhere other than at trade premises—that is, anywhere except at premises where goods of the type in question are normally sold or exposed for sale. This is something new. It is aimed at an evil which has been the subject of much complaint and about which the Molony Committee were much concerned—namely, the salesman who goes from door to door, exercises pressure on customers in their own homes and induces them to sign binding agreements. In many cases the complaint is that the salesman goes round during the day, catches the housewife on her own, and gets her to sign up before she has a chance to talk the matter over with her husband. But these are not the only cases: there are also cases where both husband and wife have been present but the sales pressure exerted on them has been excessive. Such transactions may result in the customer committing himself to more than he can afford. Sometimes, moreover, the article is something that he does not really want and would not himself have thought of acquiring.
The Molony Committee's solution was a 72-hour "cooling-off period". The Bill gives effect to this recommendation, but

1143
for practical reasons makes the period a little longer—it is the Molony Committee's three days, plus the balance of the day on which the hirer receives the statutory copy of the agreement. To ensure that the hirer then realises that he has the right to cancel the agreement, a statement of his right must appear prominently on the agreement. And to reduce the risk of trickery, the copy of the agreement must be sent to him through the post, not delivered by hand.
My Lords, I think there will be no objection in principle to these proposals. The activities of unscrupulous salesmen have caused unhappiness in many families, and I am sure that everyone will welcome a measure to check this. As the Molony Committee said in paragraph 521 of their report:
"It is not in the true interest of any party (save the disreputable) that hirers should undertake obligations which they cannot reasonably discharge."
Some may feel that, in order to deal with what must be, comparatively speaking, a small proportion of salesmen, the Bill interferes with the business of a far larger number of traders against whom there is no complaint. I am sure that nobody wants to suggest that all salesmen who go round visiting customers in their homes are rogues. On the contrary, most of them are honest traders—indeed, this is an old-established and often welcome way of buying goods on credit, especially clothing and household goods, and one which is widely practised. The Bill is not aimed at that trade. The fact is that the slick salesman has done great harm to the image of that trade as a whole. Anything which curbs his activities will improve that image and benefit the trade as a whole. There is no intention whatever of disparaging or discriminating against the legitimate credit trader. In practice, I think these provisions would effect his trade much less than he fears. In particular, so tar as credit-sales are concerned, the "cooling-off" provision will apply only where the total purchase price exceeds £20, so that a great part of the traditional transactions—for example, credit-sales of clothes and blankets—will not be subject to it.
The credit traders take some pride in the personal connections between their salesmen and their regular customers;
1144
this mutual confidence should in practice ensure that the housewife will be buying only what she wants, so she will have no wish to change her mind. In cases of uncertainty it will of course be open to the trader to delay delivery of the goods, until the "cooling-off period" has elapsed. The Molony Committee recommended that failure to comply with the requirements about the "cooling-off period" should be a criminal offence. In our view, the major sanction—that is, that the agreement will not then be enforceable—is on its own sufficient and there is no need for a criminal sanction to reinforce it. I know that respectable credit traders were particularly uneasy at the prospect of a criminal sanction which applied solely in respect of their trade, and I hope that its omission from the Bill will help them to accept the "cooling-off period" as the desirable social safeguard that it is.
It has been suggested that these provisions should go wider and cover all transactions; and I think that is what the noble Lord, Lord Lucas of Chilworth, was suggesting. After all, there are glib salesmen in shops as well as on doorsteps. This is a question of proportion. To apply the "cooling-off period" generally would mean interfering with an enormous number of commercial tranactions and would result in many delays. The evil of door-to-door high-pressure salesmanship is a distinct and a particularly serious matter; the "cooling-off period" is a safeguard particularly designed to deal with it. The more general question, whether the customer should always have a right to change his mind, arises whether the transaction is on credit or for cash, and it is in the general context, I submit, of the sale of goods that it ought rather to be considered; and that is one of the points in the Molony Committee's Report that will have to be dealt with later.
Clause 8 deems the dealer to be the agent of the owner or seller as respects representations he makes concerning the goods. This clause deals with an unsatisfactory situation which can at present arise because of the nature of a hire-purchase transaction. The Law Reform Committee drew attention to it in their 10th Report (Cmnd. 1782). Because the hirer's contractual relationship is with the finance company, he may at present

1145
find himself powerless if the article turns out not to be as good as he expected from what the salesman told him that it would be. This applies particularly to second-hand cars. We believe that this change could benefit hire-purchase business considerably. It should cause some finance houses to be more careful than they have been in the past about the dealers from whom they accept business.
My Lords, I pass on to Clause 12. At present, it is common for finance houses to include in hire-purchase agreements a provision under which the agreement terminates if the hirer dies. By no means all enforce this provision; indeed, if there is someone prepared to go on with the payments, most finance houses will come to an arrangement with him. But, as things stand, they can terminate the agreement and recover the goods, even at a very late stage in the agreement, when the hirer had almost completed paying the instalments at the time of his death. This clause, following the recommendation of the Molony Committee, makes void any provision in a hire-purchase agreement terminating the agreement if the hirer dies. Clause 13 deals with situations in which Clause 12 is not enough to deal with those left behind.
May I refer briefly also to Clauses 14 and 15? The courts at present, as I have mentioned, have various courses open to them when the owner applies to repossess the goods because the hirer has defaulted on his payments. These clauses supplement the existing provisions and permit of certain remedies which we feel, in fairness to the owner, should be possible but may not be possible under the law as it stands—in particular, to recover by court order the balance of the hire-purchase price where the hirer has failed to comply with a previous court order to return the goods to the owner.
Before I leave Part I of the Bill, there are two general points to be made. First, it has been suggested that the increased number of agreements now brought within the Act will mean an increase in the number of cases before the county courts and that the hearing of these will be delayed. My noble and learned friend the Lord Chancellor has considered this aspect and is satisfied that congestion and delay in the courts are
1146
not likely. One factor which those who are worried on this score may not fully have taken into account is that only a very small proportion of the hire-purchase cases which come before the courts are defended. Generally speaking, undefended cases are taken before registrars, and the average interval at present between the issue and hearing of summonses is about five weeks. Defended cases are normally taken before judges, and the average interval is one week more.
Secondly—and this is a much more general point—there is the suggestion that, in amending the Hire-Purchase Act, we are tinkering with something which is basically unsatisfactory, and that what is required is an entirely fresh approach. Such legislation, it is said, should deal with the facts of buying and selling where the customer has not got ready cash on a realistic basis and in the light of modern conditions. Of course there is something in this suggestion. My right honourable friend has already indicated in another place that the Board of Trade are studying these deeper problems and would welcome the views of the bodies concerned. But the question is not simple. It is not just a matter, as I have seen suggested, of amending a few obsolete Acts. The hire-purchase laws provide a code of protection for the consumers. In devising a different system we must secure a comparable and proper balance between the different interests concerned in a transaction. Meanwhile, there is this great volume of business being done on hire-purchase and credit-sale terms.
The Molony Committee have shown how the Act can be improved. We are not prepared to delay in making these improvements. What is more, even if new systems are introduced, hire-purchase will remain. I should like to quote to your Lordships what the Molony Committee said in paragraph 568 of their Report:
"Our leading comment on the deeper criticism of hire-purchase law and the proposals for a fundamental recasting of the legal character of the transaction is that we are not interested in law reform merely for the sake of reform. If we felt that the existing legal structure was incapable of supporting consumer interests to the necessary degree we should have to probe more deeply into its theoretical deficiencies."
I leave the matter there, and I turn now to Part II of the Bill, which deals with

1147
the amendment of the law in Scotland relating to hire-purchase and credit-sales.
At present, there is a separate Scottish code. The Hire Purchase and Small Debt (Scotland) Act, 1932, was a pioneering venture; it dealt with certain evils which had already arisen at that time. By 1938, when the Hire-Purchase Act was passed for England and Wales longer experience had made it possible to draw up a more comprehensive code of protection for the consumer. The Molony Committee recommended that, so far as possible, the same code should apply throughout Great Britain, including the minimum payment of one-half of the hire-purchase price, and this is what the Bill proposes. We accept that recommendation. It is logical, therefore, to frame our reforms on the basis of the law on hire-purchase and credit-sale in England and Wales, which is more detailed and comprehensive and confers on the courts extensive powers.
The effect of the Bill will be to apply in Scotland the 1938 Act as modified by Part I of this Bill. The differences which will remain arise solely from differences in Scottish legal terminology and practice. For all hire-purchase customers in Scotland this is a great advance, for the new safeguards and benefits they will enjoy far outweigh the loss of the one advantage they had over the customer on the other side of the Border—namely, the minimum amount which the hirer must pay if he wishes to terminate the agreement. In England and Wales it is one-half of the hire-purchase price; in Scotland it is one-third of the hire-purchase price. Under the Bill it will be one-half throughout Great Britain.
I am conscious that, having spoken at some length about Part I of the Bill, I may have appeared to pass too quickly over this sweeping change of the law in Scotland, the importance of which I naturally appreciate, if I may venture to say so, as much as any of your Lordships. The truth is that everything I have said so far applies no less to Scotland than to other parts of this island. In recognition of the far-reaching nature of the changes for Scotland we have set out in full in the Second Schedule the provisions of the principal Act as
1148
they will apply in Scotland, as amended by this Bill but not including the new provisions contained in this Bill. I trust this will help Scotsmen in Parliament and outside it to understand how the adoption of the 1938 Act would affect them.
Next, my Lords, I turn to Part III of the Bill. This again breaks new ground. It deals with a situation which is at present all too common and in which real hardship is caused to possessors of motor cars. A man is offered a car and pays for it. Later he finds out that the car was the subject of a hire-purchase agreement. Legally the car belongs to the finance house, and our unfortunate man has no right to it. The finance house can take it away. Often they will let him keep it if he pays them whatever balance was outstanding under the hire-purchase agreement; but that may be small comfort to him, since the outstanding balance may be substantial, and he has already paid once. His only remedy is to find the person from whom he got the car and try to get the money back. In practice, even when the man can be found, he rarely has the money to pay.
The Bill proposes a system designed to hamper fraudulent disposals of this kind. Under this system, to be operated under Regulations to be made by the Minister of Transport, a man who is acquiring a car under a hire-purchase agreement will be issued by the finance house with a licensing card, which he will use when he renews the road fund licence. It will be the duty of the finance house to retain the car's registration book. So, when the scheme is in full operation, anyone who is offered a car by a man who cannot produce a registration book will have fair warning that the car is probably subject to a hire-purchase agreement.
There is a further safeguard for the consumer. If the finance house fail in their duty and allow the hirer to have the registration book, then the buyer will have a good title to the car, and it will be for the finance house to go after the rogue to get their money back, and not, as at present, for the innocent, if gullible, person who thought he had bought the car. We considered other schemes, but we came to the conclusion that this scheme would afford a valuable measure

1149
of protection without causing a disproportionate amount of expense and paper work, though something of this kind is unavoidable.
One alternative which we considered and rejected was that each car should have a document of title, a kind of birth certificate, which would go with it and be passed from owner to owner from the time when the car is born in the factory to the time when it is buried in the scrapyard. To be workable in practice, this scheme would have to be backed by a national register of all cars and their current owners; otherwise impossible situations would arise when documents of title were lost, as from time to time they would be. We found that the cost in time and money would be quite disproportionate and the risk of fraud considerable.
Meantime, in the interval before the proposed scheme becomes fully effective, the would-be purchaser of a car is not without safeguard. The hire-purchase trade themselves maintain a register of cars in respect of which there are hire-purchase commitments. They believe that more than 99 per cent. of the agreements made are entered in this register. It is used by the finance houses and the motor trade to guard themselves against paying out money for cars on which hire-purchase commitments are outstanding. But any member of the public who is thinking of buying a particular car can also find out whether it is on the register. He can do so by inquiring through a citizens' advice bureau or through one of the motoring organisations. I cannot impress too strongly on anyone who is buying a car that, unless he is quite sure, he should make use of this safeguard even if it means he cannot have the car for a day or two.
I turn now to Part IV of the Bill which introduces two changes into the Advertisements (Hire Purchase) Act, 1957. That Act provides that, when an advertisement says that particular goods are available on hire-purchase or credit-sale terms and quotes some of the terms—for example, the amount of the deposit or the amount of one instalment—it must give all the relevant terms, so that the consumer can tell how much more he is going to pay by having the goods on hire-purchase terms than he would if he paid in cash.
1150
The first change which the Bill introduces is this. As the Act stands, the advertisements must show the cash price, the amount of any deposit and the amount and number of instalments. The consumer can thus work out what it is going to cost him to get the goods on hire-purchase terms. Clause 27 requires the advertiser to do the sum for him, by including in the advertisement, as well as the information already required, the hire-purchase price. This is a change which was recommended by the Molony Committee. The second change concerns the case where one of these advertisements represents the hire-purchase charges as a rate of interest. In paragraph 565 of their Report the Molony Committee drew attention to a number of ways in which this could be done so as to mislead the consumer. This Bill, through Clause 28 and Schedule 3, requires that if a rate of interest is shown, it shall be calculated in such a way that it avoids all these deceptions. We have included a formula by which traders can readily calculate the rate which they are permitted to advertise. I myself have tried it out, and, although I do not profess to understand how it is arrived at, it seems to give quite a good result. Part V of the Bill contains supplementary provisions with which I need not trouble your Lordships at this stage. The date of coming into force is January 1, 1965.
My Lords, this brings me to the end of my exposition of the Bill, and almost to the end of what I have to say. I would add this. This Bill is first and foremost a measure of consumer protection. The safeguards it introduces are ones which practical experience and careful examination by the Molony Committee have shown to be needed. This is not a Bill directed against any section of honest traders. Indeed, some of the things which will become obligatory when the Bill is in force are already practised by some, at least, of those who let goods on hire-purchase or sell them on credit-sale. It merely seeks to maintain a proper balance between the various parties involved in a hire-purchase or credit-sale transaction. It is true that the Bill brings large new areas of trade, particularly in motor vehicles, within the Act. But the provisions of the Bill must be looked at as a whole. We believe they will lead

1151
prudent finance houses to look more carefully at the business they accept: this includes the credit-worthiness of the hirer and the probity of the dealer.
If one result of the Bill is to stop finance from being available for transactions of the kind in which a man who cannot afford the money acquires a car through a dealer who conceals from him that it is not much of a car anyway, I, for one, shall be glad. This sort of change should reduce and not increase the number of cases in which finance houses lose money. Further, it should improve the public image of the hire-purchase business, to the benefit of all concerned—the customer and the trader, including the finance houses. I therefore ask your Lordships to welcome the Bill, and I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read 2a.—(Lord Drumalbyn.)
4.53 p.m.
LORD PEDDIE: My Lords, I should like first to express my congratulations to the noble Lord, Lord Drumalbyn, on his maiden speech in this House—although it seems presumptuous on my part to be congratulating him on the making of a speech. I find that I can extend congratulations with great sincerity, as I am in a great measure of agreement with the comments he has made on this Bill.
Twenty-five years have elapsed since the Hire-Purchase Act, 1938 was passed. Since that time there has been an enormous growth in hire-purchase and credit-sales. The noble Lord has given an indication of the extent of the hire-purchase debts, which I believe he quoted as £934 million. Over that same period there has been a great change in the field of operation of hire-purchase companies because of the great change in the social structure of society. I find it incredible that over that period of time there has been no major reassessment of the system of credit-trading in this country. I recognise that hire-purchase is important to the economy of this nation, as well as to the consumer, and I recognise that a knowledge of the abuses which exist must not cloud our recognition of the importance of hire-purchase. I am certain that there are many industries,
1152
particularly those dealing with durable goods and cars, which have found in hire-purchase a means of stimulating mass demand and of reducing their unit costs of production.
All this is quite true, but abuses there have been over the years; and abuses there still are. The records of the courts and of the social organisations, and the files of newspapers, give tragic evidence of the misery and distress born out of consumers' ignorance and the rapacity of less scrupulous hire-purchase companies. All this because of the inadequacy of reasonable legal protection. This Bill goes quite a long way towards correcting those abuses and enlarging the area of protection afforded by the 1938 Act and, therefore, can be welcomed. The Bill covers the two main features of my own Bill which I presented to the House a few days ago, and therefore it is my intention to seek the permission of the House to withdraw it.
It has been said that there is more joy in Heaven over the one sinner that repenteth than over the ninety and nine just persons who need no repentance. I can assure noble Lords opposite that the joy will be not unalloyed on earth, because the sinner was well aware of the swift inevitable punishment if repentance was delayed. This Bill does not provide the completely comprehensive approach to hire-purchase which was promised eleven months ago. A year ago my own Bill was defeated, and the argument used against it was the need for comprehensive legislation and the unsuitability of a money limit. Those arguments have been discarded by the Government. As far back as 1961 in another place Mr. Tom Williams had a Bill on hire-purchase rejected—a Bill which would have dealt with certain abuses, as did mine. Since that period nothing has been done. In the interim, serious abuses have been tolerated and protection withheld.
I have already said that I welcome the Bill, but I wonder at the mystery enshrouding the Government's attitude towards hire-purchase reform. Despite constant pressure, recommendations from Molony and a flood of evidence demanding reform, despite protestations that the Government have a deep interest in consumer protection, there was not

1153
a line about this question in the Queen's Speech. Because of that, my own Bill was re-presented. There was then a panic haste to present a Bill. I present my apologies to the legal draftsmen who burned the midnight oil, but I deplore the manner in which the Government have handled this matter. Twelve months ago there was a specific promise of detailed discussion with all the interests involved. Yet the speech of the Minister in another place, as well as the speech of the Minister this afternoon in this House, confirms that this has still to be done.
I support, as I am sure most noble Lords will, the extension of the area of application of the 1938 Act and the lifting of the financial limit to include a far greater range of hire-purchase transactions. In the past, as the noble Lord has stated, arguments have been deployed against a money limit. It is true that Molony rejected all money limits to the application of hire-purchase legislation as being arbitrary and liable to get out of date. This may be true; but "no limit" carries its problem of defining a consumer sale. The noble Lord opposite did not pay great attention to that point, but it is important. Even with a precise definition there would be excluded from protection those small business men and farmers who take up hire-purchase. The present Bill, I am glad to see, overcomes the difficulty of a money limit by providing for extension, as required, by an Order in Council approved by both Houses. But I would point out that, having accepted that principle, it would be logical to give the same power to vary the lower limit for credit-sales agreements which are now lifted from £5 to £20. That change is justified in consequence of the change in money values. If that be so, surely the same methods should be employed to bring about a variation in the amount when circumstances demand it.
The noble Lord opposite dealt with the problems that arise from the increase in the upper limit to £2,000, and made reference to the question of county courts. I, too, would underline the problem that exists in that direction. I must say, quite frankly, that I could not quite understand the reasoning behind the explanation of what was likely to happen. To-day, actions arising from hire-purchase are dealt with in the county
1154
courts, if the amount involved does not exceed £500, and I agree that the lifting from £300 to £2,000 will mean that many cases cannot come before the county courts and must be dealt with in the higher courts, with consequential delay and expense. I understand that the county court cases involving hire-purchase were 57,000 in 1962, as compared with 18,000 in 1951. Is it the intention of the Government to do something with regard to increasing the limit which determines the cases that could go before a county court?
I appreciate, my Lords, that many hire-purchase companies will not welcome the lift from £300 to £2,000, because this will involve the majority of transactions in cars. They will argue, as has been argued in the past, that their security is prejudiced under the operation of the 1938 Act, which states, as the noble Lord opposite indicated, that if one-third of the hire-purchase price is paid the owner cannot repossess except by court order, and the hirer is given the right to terminate his agreement by paying one-half of the purchase price. But in reply to an argument of that kind which is advanced by the hire-purchase companies, it is as well to remember that the majority of motorcycles are under £300 and presumably come within the 1938 Act, and it is difficult to believe that the purchaser of a motor car is less mature and responsible than the average buyer of a motorcycle. The Joint Committee of the Automobile Association and the R.A.C.—which, incidentally, supported my Bill twelve months ago—have stressed the need for urgency in extending the 1938 Act to cover hire-purchase of motor cars.
I know that there will be no shortage of advocates of the finance companies' view, that if higher-priced cars are to be put under the protection of Hire-Purchase Acts it will place a premium on customers defaulting. As the noble Lord, Lord Drumalbyn, mentioned, finance houses have suggested as an alternative what they call a "true measure of damage formula" in which if a customer terminated an agreement he would owe the hire-purchase company the difference between the value of the car as it then stood and the total hire-purchase price. I am sure that this point will be debated at Committee

1155
stage. There is also the argument which is advanced, and will be advanced with increasing force, so far as hire-purchase companies are concerned, that in the case of cars repossession without a court order should be permitted up to two-thirds instead of one-third. I would say to your Lordships that there is absolutely no justification for depriving the hirer of protection of the courts for so long a period.
On December 2, 1963, the Secretary of the Finance Houses Association stated that
"to improve their security finance houses will need to be even more careful about their selection of customers".
Why not? It is in the best interests of all that they should. The finance houses argue that the raising of the limit will mean increased charges to all users of hire-purchase. But is interesting to read the comment in a recent issue of the Economist—which was not unfavourable to the case of the finance companies—which says:
"The hire-purchase industry has on occasions in the past been a singularly bad judge of what is good for it, and the public it served."
The Joint Committee of the Automobile Association and the R.A.C., to which I referred, confirmed a few months ago the point of view of the Molony Committee which completely rejected the anticipations of finance companies that the removal or the lifting of the limit would lead to higher prices and a harsher policy on the part of finance companies as regards repossession. In fact, they believed that
"the more likely outcome was that finance houses would be more careful in accepting business and more insistent on a higher deposit as an assurance of good faith and full performance of the hirer."
It will be said that the present right to repossess exerts a discipline on the less credit-worthy customer, but I would suggest that it also invites hire-purchase companies to be indiscriminate in the offer of hire-purchase facilities without due regard to financial status. I believe that it would be of advantage to all if hire-purchase companies were forced to be more selective in the granting of credit. Indeed, if there is any question of the balance of consideration, that balance should be weighted in favour of the consumer,
1156
because in the long run such would be in the national interest.
On the question of credit-worthiness, it is as well to remember that finance houses already have under their control very highly organised facilities for checking the credit-worthiness of prospective customers. Perhaps the real fear is that the competitive scramble for motor business restricts proper care in selection. Indeed—I am sure this House will agree—most of the evils spring from over-eagerness to lend to those who cannot afford to borrow. In the jungle of competition there are many finance houses to-day which pay motor dealers commission for hire-purchase business. The stronger the competition, the higher the commission, and the higher the final price the customer has to pay. I think dealers should be made to be content with the profit on the car they sell, rather than seek commission upon the hire-purchase they transfer to another company. I believe the real argument in connection with this is that greater selectivity will ultimately mean lower costs, in the best interests of the consumer as well as the finance house itself.
I am not aware of the exact figure of the average loss on turnover of hire-purchase companies, but I am informed that it amounts to an average of 2 per cent. per annum since 1958. It is interesting to note that one co-operative society in England with a turnover of £1½ million in hire-purchase reports that for the last four years there was an average loss of less than one-tenth of 1 per cent. on turnover; and, incidentally, they gave better terms than many of these hire-purchase organisations. Indeed, not one of those societies has the iniquitous clause that on the death of a hirer an agreement is terminated, regardless of what has been paid by the customer. I was glad to see that this practice goes in Clause 13.
Only a matter of a few days ago I received a copy of an agreement from a person in Sidcup whom I do not know. In small print on the back, which I can hardly read, it says:
"Without Any Previous Notice or demand being given by the Owners, who shall be entitled to immediate possession of the Vehicle upon the happening of any of the following events:
"(a) Upon the death of the Hirer."

1157
This man suddenly realised that he had almost completed the payments but in the event of his death his wife would not get the car. It would be immediately snatched by the hire-purchase company.
I welcome the applicability of this Bill to Scotland, because—I agree with the noble Lord opposite—there is good reason for the uniformity of hire-purchase legislation throughout Britain. But I would point out that there is a considerable difference, as we all know, between the legal system in Scotland and that in the rest of Britain. The consequential adoption of the 1938 Act as amended by the new Bill will involve very drastic changes in Scotland, and Scottish traders and consumers will need to familiarise themselves with these changes. I sincerely hope that the Board of Trade will be far more helpful in issuing explanatory booklets on this new legislation than they have been with regard to some legislation in the past.
I welcome indeed Clauses 3 to 7, which provide a hirer with the right to cancel hire-purchase transactions where an agreement has been signed at a place other than trade premises. I need not enlarge upon that: I have spoken on it before. This, I think, deals with the greatest evil of all. This "cooling off" period, as the noble Lord opposite indicated, will inflict no hardship at all on the legitimate trader, but will give a measure of protection to the consumer and, I hope, eliminate many of the bad practices that exist in that regard. But I would make this reference to one particular difficulty upon which I would seek enlightenment. Clause 5(1)(a) states that a notice of cancellation
"shall be deemed to be served on the owner or seller if it is contained in a letter sent by post …".
But how will evidence on this point be produced unless the sender of the letter produces evidence of posting? It may be better if the letter were sent by recorded post, but I appreciate that the absence of the need for a recorded letter may possibly be in the interests of the consumer. I should like some enlightenment as to how this will be interpreted. If the consumer merely says, "I posted a letter", and the hire-purchase man says, "I never received it", what happens in that particular case?
I welcome also—and I am sure every Member of this House does—Clause 8,
1158
which quite rightly provides that a dealer is considered to be the agent of the hire-purchase company. This is commendable, for it gives protection to the consumer, the customer, who purchases goods from a dealer and then frequently finds that he has entered into an obligation with some hire-purchase organisation. The trader can then shed his responsibility for the goods, and if they turn out to be defective the hirer can sue the trader only if he has been fraudulent. I also welcome the attempt to deal with the advertising of H.P. terms. The charge is often made that some hire-purchase companies deceive the public by quoting a rate lower than that actually charged, and I think that is true. It is done by quoting a rate of interest calculated on the amount owing at the beginning of an agreement, and then, as instalments are paid, the original amount is reduced and, over the year, the real rate of interest is often twice as much as that originally quoted. Under this clause it must be an annual rate. But I was exceedingly interested to hear the noble Lord opposite indicate that he had not quite understood the formula. Nor have I, and I am quite sure a lot of other people, customers and hire-purchase people alike, will find a great deal of difficulty in understanding that formula.
LORD DRUMALBYN: My Lords, if the noble Lord would allow me to interrupt, what I did say on that was that I had worked out a sum on the basis of the formula. I do not think there is any difficulty in using the formula: the difficulty is only in understanding how it is arrived at. But that, I think, is immaterial. I think it can be accepted on its face.
LORD PEDDIE: I thank the noble Lord for that explanation, and I can commend his mathematical ability, which is obviously far greater than mine. Nevertheless, I accept the whole spirit behind the clause: I think it is quite good.
The clause to prevent the fraudulent selling of cars that are on H.P. is both novel and interesting, inasmuch as it is giving to the Minister of Transport the power to make regulations for hire-purchase firms to retain the log book

1159
and issue a licensing card. We are grateful for the detailed explanation which the noble Lord gave, but there is one point which I hope will be more closely considered—and if I wanted to be critical, I might suggest that this is evidence of the rather hasty drafting of this Bill. We have to remember that, if this clause is operative, the log books will apparently give a title and will be recognised as a title to ownership. That is not what is stated in the Bill, but that is how it will be considered by the consumer. But as the Act is not retrospective, there will be a great number of log books relating to hire-purchase "in the pipeline", already possessed by people who have purchased cars on hire-purchase before the Act was passed. I know it is not an insurmountable difficulty, but I should like some information as to how a solution can be provided.
My Lords, in conclusion, I have indicated that, in general terms, we welcome this Bill. We recognise that the 1938 Act met a real need and that the present Bill represents a useful extension, although I would repeat that many of the abuses dealt with in this Bill could have been tackled long ago. It is important to remember, too, that when this Bill is passed and becomes law, hire-purchase law will be contained in the following Statutes: the Hire-Purchase Act, 1938; the Hire-Purchase Act, 1954; the Advertisements (Hire-Purchase) Act, 1957; and then the Hire-Purchase Act, 1964. In addition to that, hire-purchase trade is subject to Control Orders which are made, not under hire-purchase law at all but under Defence Regulations going back as far as 1939. Surely it is incredible that, twenty years after the war, the Board of Trade are still using emergency powers to deal with hire-purchase. I would suggest that there is urgent need for the reform of consumer credits. The 1938 Act was a good Act, but we must make sure that in the course of time it does not become a straitjacket. There is need, an urgent need—and I hope that the Government are going to meet it—for a consolidating Act based upon a detailed inquiry and original thinking: original thinking which I should hope would come from all the interests involved in the practice and trade of hire-purchase.
5.18 p.m.
LORD AIREDALE: My Lords, may I join with the noble Lord, Lord Peddie, in congratulating the Minister upon his maiden speech. I do not suppose that I shall ever have another opportunity in my lifetime of congratulating a Minister upon his maiden speech. Maiden speeches in your Lordships' House are usually short, and the Minister apologised to the House for having spoken at some length. On the other hand, he explained to us a Bill of 32 clauses and 7 Schedules at the rate of, I think, just about one minute per clause or Schedule, so I do not think we can hold longwindedness against him, certainly not upon this occasion.
May I also join with the noble Lord, Lord Peddie, in inviting the Government to consider extending the jurisdiction of county court judges in hire-purchase cases, if it is the fact, as the noble Lord suggested, that the raising of the money limit will mean that otherwise many of these cases will fall to be decided in the High Court and not in the county court? In this matter, county court judges begin with a flying start over their brethren in the High Court, because their knowledge of hire-purchase legislation must to-day be immensely greater than that of the Judges of the High Court.
My Lords, I should like next to say one or two words about what I may call the hire-purchase document, the document which the hirer retains in his possession and which explains to him the nature of the transaction he has entered into and certain ancillary matters. First of all, I welcome the Government's adopting one of the recommendations of the Molony Committee where, in Clause 2, subsection (2), they are seeking power for the Board of Trade to prescribe that the hirer's signature should be placed in a certain position on the document and that certain words, to be decided upon by the Board of Trade, are to accompany the place of the signature.
May I here quarrel on one small point with the Molony Committee, who have drafted a sentence of 23 words (I will not weary your Lordships by reading it) which they think should accompany, or be adjacent to, the place where the hirer is to place his signature on the document. I believe there are people who

1161
will not even trouble to read a sentence of 23 words while the salesman is hovering over them holding out his Biro pen and inviting them to sign. I should have thought that these 23 words could be reduced to three. All that is needed is: "Hire-Purchase Agreement". If those words were to accompany or be adjacent to the place where the purchaser has to sign, no dullard could then fail to appreciate that what he was signing was a hire-purchase agreement.
The Molony Committee were a little concerned about some hirers who have to terminate the agreement prematurely not being aware of what they were supposed to do with the goods. Clause 6 of this Bill makes it abundantly clear what are the hirer's duties in relation to the goods when the contract is terminated prematurely. I only wonder whether it would not be worth while to have the quintessence of Clause 6 incorporated into the document which the hirer retains in his possession, to enable him to know exactly what his duties are in relation to the goods if the contract is prematurely terminated. Otherwise, the hirer will have to look up the Act and read Section 6, as it will then be; and I do not believe that many hirers will be able to find their way to it.
We come now to the question of dealers' commissions. The noble Lord, Lord Peddie, referred to this as did the Molony Committee. These operate as secret commissions about which the hirer, out of whose pocket, of course, ultimately the commission comes, knows nothing. The Molony Committee say that these commissions are frequently of the order of 15 per cent. and sometimes a great deal more. I cannot think—and here I agree with the noble Lord, Lord Peddie—that these commissions are necessary at all. The finance companies confer a benefit on the dealer in any event by enabling the dealer to sell something on hire-purchase which often he would not otherwise be able to sell at all. Why there is any need for commissions to be paid to the dealer, I fail to see.
The Molony Committee thought it would be very difficult by legislation to stamp out these commissions. No doubt the best way to deal with this is for the Finance Houses' Association to try to get agreement amongst its members
1162
to forgo paying these commissions which do, eventually, come out of the hirer's pocket. But as an inducement, perhaps, to the finance houses to come to this conclusion perhaps it would be as well to require that the amount of any commission payable to the dealer be stated upon the document. That would, at any rate, remove the secrecy of this commission which is a very bad feature. Another bad feature is that the dealer receiving a commission in these circumstances is always tempted to induce the hirer to go into a hire-purchase transaction rather than a cash sale, on which no additional commission is payable to the dealer; whereas, of course, cash sales are to the benefit of the consumer if he can possibly afford them.
I should now like to say just a few words about the escape clause or "cooling-off" period. As I said on the Second Reading of the Bill of the noble Lord, Lord Peddie, in our last Session, I regret that this escape period is not being made available to both parties. I say this both on general principles and on the particular grounds of these particular cases. One starts with the general principles that there shall be freedom between people to make contracts one with another, and if Parliament is going to intervene and place limitations, then surely, whenever possible, Parliament should make equal limitations for both sides. It is not always possible, but it is possible in this case. It is possible to say that there shall be a four days' "cooling-off" period, both for the hirer and for the finance company, which really means the salesman.
When we take into consideration the particular facts of these cases, I believe it is really necessary for both parties. The salesman, to whom the householder readily opens his door, finds probably that this is not the first time that the householder has readily opened his door to a salesman. When he gets inside he probably finds many gleaming, new pieces of furniture and appliances and his suspicions may be aroused. He may start wondering how many of these goods are already the subject of hire-purchase commitment on the part of that householder. You cannot expect him to say to his prospective customer, "I am not going to complete a deal with you until I have checked up your credit worthiness because I suspect you." But it would

1163
be very useful if the salesman could have a four days' "cooling-off" period in which to check up upon this householder; because it is no use to either party that the householder should over-commit himself on hire-purchase. I very much hope that, if the Government are not themselves prepared to put down an Amendment, they will accept an Amendment in Committee to make the "cooling-off" period available to both parties to the transaction.
That is all I have to say, my Lords, except to join in the debate in miniature which has already taken place between the noble Lord, Lord Peddle, and the Minister about the formula in Schedule 3. Paragraph 6 of that Schedule decides the calculation of the rate of interest or charge. The Minister said—I think these were his words—that the traders can "readily calculate" from this formula. I dare say that the finance houses have mathematical wizards in their offices who would have no difficulty with this; but I am sorry for the dealer who supplies his own finance—and some dealers do. If he can readily work out the formula:
200md/p(n+1)+d/3(n-1)
then I will eat my hat. With those few reservations, I welcome this Bill as being very well worth while.
BARONESS ELLIOT OF HARWOOD: My Lords, I have listened with great interest to three extremely interesting speeches, including a maiden speech from my noble friend who sits on the Front Bench, on which I wish to congratulate him, and an excellent speech from the noble Lord, Lord Peddie, from whom I expected an excellent speech, since he is a member of the Consumer Council and I have already discovered how expert he is on these matters, and I knew I would hear from him many things with which I was in agreement. I find myself in agreement with what has been said on both sides of the House, which does not often happen. The figures we have been given of the enormous sums involved in hire-purchase, totalling £934 million, show that it is high time—indeed, past time—that we should be placing safeguards on
1164
the Statute Book. I am told that in the United States of America the figure is £23,000 million. It is a much larger country than ours, but if we go in for this method of trading in as big a way, even our £934 million will increase in time. Therefore, this is a most important question.
The Minister has given a clear outline of the Bill and of how it affects the many millions of consumers who trade in this way. Many of these transactions are done on the doorstep. This can be a very simple operation, but it can also be very complicated, and occasionally it can go wrong. It can also be unwanted. In enabling the buyer to know exactly what he or she is buying, the Bill is very welcome. What I should like to see is that when a salesman and a householder come to an agreement about the purchase of an article, the seller should there and then produce for the buyer an agreement in duplicate. The buyer should have a copy of the terms of agreement in his hands. The Minister said that this is going to be sent through the post. That is one way of doing it, but I should think that a simpler and more practical way is to do it on the spot, by the simple process of writing the agreement in a book with a carbon copy and handing the copy to the buyer. Then, during the "cooling-off" period, the buyer would have exactly what was signed for in his hand, to show to husband or wife, as the case may be, what is entailed under the agreement. This carbon copy system is a way we all know, since it is done in shops every day, and I do not see why it could not be done on the doorstep.
The document left behind must describe accurately the terms of the agreement between the buyer and the seller and, in addition, should make the buyer aware of important points, such as, that in consenting to this agreement he potentially commits himself to buying goods on hire-purchase or by the credit-sales system. If it is hire-purchase, then the buyer must know that he does not own the article until he had paid all the instalments, and therefore has no right to sell the goods half-way through the payments without the consent of the owner, who may be a finance company or a dealer. Many people do not realise this, because they get so used to looking at the articles they buy, whether it be a

1165
motor car, washing machine or cooker. Familiarity breeds, not so much contempt, as a feeling of ownership. I feel that it is important that this point should be adequately stressed in the course of the transaction.
I am glad that the Bill insists on a three-day period in which the buyer can think over his purchase. This is most important. But I think that we might add one of two other things—for instance, that the buyer should not only contract-out, if in the three days he decides that he does not want the goods, but also that he should contract-in, if he wants to buy the goods. This could be quite simply done by the salesman, when he leaves the copy of the agreement with the buyer, also leaving a printed postcard or slip of paper, which the buyer can send to say whether he wants the article. This would help the salesman, since, if the postcard arrived before the contract became binding, he might be saved the trouble of going back to the house. It may be said that contracting-in may hamper the transaction. But if a buyer cannot be bothered to contract-in, he probably will not bother to contract-out. In any case, I am all for impressing on the purchaser his responsibilities—the need for him to take a positive step either way.
I support the clauses which deal with the raising of the ceiling, whereby a finance house or owner cannot "snatch back", as the Molony Committee put it, the goods which are being paid for under hire-purchase agreement. The £2,000 limit, which the noble Lord, Lord Peddie, has discussed, should cover most of the articles likely to be bought on hire-purchase. I suppose that motor cars are the most likely to come under this clause.
I have read in the Press that the finance houses are worried about this clause. They see the possibility of a purchaser defaulting after he has paid, say, 50 per cent. of the price, and handing in a car which is not worth the remainder of the purchase money. This could be obviated by a clause in the Bill allowing for a "true measure of damage" formula, which, in the case of motor cars and other mechanical vehicles, such as tractors, could be fairly easily assessed, because the second-hand value is generally agreed in the trade. I do not agree with the suggestion made by
1166
the finance houses, that they should have the right to recover a car without a court order when two-thirds of the price has been paid. In all probability, the customer will have paid a substantial deposit at the beginning, and he should get the benefit of the protection of the courts, as is the law in Scotland. The formula for damages should protect the seller from any dishonest intentions among buyers.
All that is in these clauses stresses the importance of both sides taking great trouble to see that transactions are carried out in good faith on both sides and not under pressure. I think that this is a good thing, a good thing for all, even though it may slow down a little the number of hire-purchase transactions. In the long run, it may prevent many of the troubles that the system has had to meet.
There are two points in connection with dealers which I welcome. The first is the proposal in the Bill to make dealers responsible for the statements they make about the goods they are selling. If, for instance, a car dealer persuades a customer that the car he is selling is a certain age or that the engine is sound, when in fact it is of an earlier manufacture than he thought and there is a fault in the cylinder, the buyer can pin responsibility on the seller and claim for the defects in the goods. Otherwise, under the present Acts, I understand that he may be left to the tender mercy of the finance house, who will in all probability disclaim any technical responsibility for the car.
Both noble Lords, Lord Peddie and Lord Airedale, have referred to the point that we want to discourage hire-purchase finance houses from offering competitive commissions to salesmen operating door-to-door sales. I entirely agree with what has been said about this. It should be perfectly possible for the commission, such as it is, to refer only to the normal commission that a dealer would get for a motor car on the ordinary margin of retail business. I think it would be most acceptable if some arrangement could be come to whereby this other series of commissions to retailers could be done away with.
I have not dealt with the clauses in the Bill which refer to the holding of car registration books. This is an

1167
excellent proposal and should provide a safeguard against transactions being made under false ownership. There are very useful clauses about advertising. I am glad that the Bill will cover Scotland as well as England and Wales. It is important that in this new and important trading system, the hire-purchase and credit-trading system, laws in the United Kingdom should be similar. This Bill is designed to deal with immediate problems, and there are wider issues which it does not cover. But we have an announcement by the Secretary of State for Trade and Industry in another place that further legislation with a more fundamental review of the exceedingly complex legal machinery of trading goods on security is to be considered at a later date. That, I am sure, is a welcome announcement. But, in the meantime, I would support most warmly the Bill we are debating to-day.
5.40 p.m.
BARONESS BURTON OF COVENTRY: My Lords, I have a personal and financial interest to declare, in that I am a director of a firm engaged in the direct selling of domestic appliances, many of them on hire-purchase. Having said that, might I say to the noble Lord, Lord Drumalbyn, what I should have liked to say to him when I last spoke, but, unfortunately for me, he was not in the Chamber: that is to say, as I am sure the House knows, that in another place, when he was Parliamentary Secretary to the Board of Trade, he enjoyed a reputation on both sides of the House and among consumer organisations outside of having a very real interest in the consumer and the consumer's wellbeing. Because of that, many of us, while welcoming his promotion to Minister of Pensions, regretted his departure from the Board of Trade. That brings me to my final compliment. I am pleased to see him come to this House as Minister of State for the Board of Trade, and I very much hope that he will be able to answer favourably, after those compliments, some of the points I wish to put to him to-day.
Before proceeding to this Bill, I should like to say a word about the Bill which was brought forward by my noble friend Lord Peddle in the last Session. I opposed that Bill, and I opposed it on
1168
the principle that I thought the problem of hire-purchase was one which required a fundamental Bill dealing with fundamental reform. It did not seem to me that any Bill, however good, introduced by a private Member could cover this field, because I think the facilities available to private Members are obviously not comparable to those which are available to a Government.
LORD PEDDIE: My Lords, would not my noble friend agree that almost all, if not all, hire-purchase legislation, apart from this Bill, has been introduced by private Members?
BARONESS BURTON OF COVENTRY: I said that in my speech last time. But I also said that I thought the conditions obtaining at the time of Ellen Wilkinson's Bill were very different from those obtaining to-day, when there are varied views as to what these reforms should be.
Going on from there, I remember reading that the Secretary of State for Industry, Trade and Regional Development was having this whole field examined, and I should like to ask the Minister whether this means that we may hope for additions to this Bill before it becomes law—and I have read that it is hoped it will become law by Easter—or is this the utmost we can hope for in this Session of Parliament? I say that because in the Financial Times on November 29 last I read this:
"The Board of Trade, in fact, is conducting an inquiry into these more fundamental conclusions, and the present Bill is intended to be only an interim measure dealing with matters of urgent public interest."
Having said that, I would concede at once, because I approve of the Bill, that this Bill does deal with most of the matters of consumer interest that arise.
It seemed to me, on looking at the Bill, that there were five matters on which I should like to touch quite briefly. The first is where the Bill requires a "cooling-off" period for all hire purchase agreements signed anywhere other than at trade premises. The second is where it introduces a system of licensing certificates for cars bought on hire purchase; log books would be held by the hire-purchase company and the fraudulent sale of such cars before hire-purchase commitments had been discharged would be made more difficult. The third point I want to look at is the extension

1169
of the protection of existing Acts to goods up to a value of £2,000 instead of the present limit of £300. The fourth point is to make hire-purchase companies—who are the legal sellers of goods—responsible for the representations and promises of shopkeepers and salesmen; and fifthly, to lay down special words of warning in hire-purchase contract forms in the space where customers sign.
To refer again to my noble friend's Bill, he, as he said, put forward two main provisions. The first was that there should be a 72-hour "cooling-off" period for all hire-purchase agreements signed anywhere other than at trade premises. I agree with the delay. The second main point he put forward was that there should be a ceiling of £1,000, instead of the present limit of £300. I disagreed with that. Molony recommended the first point I have mentioned, that there should be a 72-hour "cooling-off" period; but, as the noble Lord, Lord Drumalbyn, said, Molony opposed the ceiling of £1,000. I held the view, and I still do, that there should be no ceiling at all.
But coming to this Bill, and to the first matter with which I wish to deal—namely, the "cooling-off" period for all hire-purchase agreements signed anywhere other than at trade premises, which is covered by Clauses 3, 4, 5 and 6—what we have in the Bill to-day is a period of four days after the customer receives a copy of the agreement through the post. I should like to put a point to the Minister, because I think it puzzles a great many people. There is no mention in this Bill of recorded delivery or registered letters. Is proof of postage going to be taken as proof of delivery? If so, I see considerable difficulty on this point. To be quite frank, what I have always wanted—and I have wanted it for years—was that such a consideration should apply to all hire-purchase agreements signed anywhere, including, obviously, retail establishments. I heard what the noble Lord, Lord Drumalbyn, said, and I do not deny that this would be a major operation. But the fact that it is a major operation is not a reason for not doing it, and I should like to tell the House, even if I am in a minority, why I feel so strongly about this.
1170
During the ten years that I was a Member in another place I had, as we all had, many constituents' problems dealing with hire-purchase brought to me. I am speaking generally, but I think accurately, when I say that during those ten years I do not remember any cases which were brought to me in Coventry which concerned hire-purchase agreements signed other than at a retail establishment. That is the point I want to make. I know the Minister said that the cheap, flashy type of salesman was not confined to the doorstep, but could be met also in shops—and I use the word "cheap" in a sense which I think your Lordships will understand. I am most concerned with trying to protect the people who deal with this cheap type of establishment, where the salesman is so glib that the purchaser has not an earthly chance of getting out of the shop without signing an agreement. I feel that this point should be looked at, because I think that some firms, whether they sell direct or whether they sell retail, have reputable salesmen who would not dream of pressurising a customer. I should be glad if the Minister could comment further on the wisdom of extending this "cooling-off" period to trade premises.
The next point is on Part III, which covers the matter of introducing a system of licensing certificates for cars bought on hire-purchase. The Bill provides that log books should be held by the hire-purchase company, so that the fraudulent sale of such cars before hire-purchase commitments had been discharged would be made more difficult. This is Clauses 22 to 26 inclusive. I would agree with this. I think it is a considerable improvement, because it is obvious that anyone who buys a secondhand car in future must be better protected than now when the seller produces the log book. It seems to me that if, in the future, the seller produces only a licensing certificate, the would-be buyer should assume that the vehicle is still subject to hire-purchase commitments, and I do not think we can do much more than that.
Clause 1 deals with the protection of the existing Acts to be extended to goods up to a value of £2,000 instead of the present limit of £300. As I said last Session, I should have preferred no

1171
ceiling, and I think this is still the case. I understand the problem of the definition of "consumer sales", but the suggestion of a limit of £2,000 is obviously a considerable improvement on the one of £1,000, and I was pleased to see that Clause 1 gave power to raise the limit by Order in Council, to which the Minister has referred. I do not think it is good to have a limit, because money values change, and any ceilings tend to become out of date. The only point I would make about Clause 8, to make hire-purchase companies—that is to say, the legal sellers of goods—responsible for the representations and promises by shopkeepers and salesmen, is to say that I heartily agree with it.
I want to come now, if I may, to Clause 2, to lay down special words of warning on hire-purchase contract forms in the space where customers sign them. Obviously, I agree; but I want to raise something else here. Molony, at paragraph 517 said—and I want to quote three short sentences:
"In order to promote better comprehension of the obligations assumed, there has been a strong plea for the simplification and compulsory standardisation of agreements. In view of the necessity for legal precision we do not think simplification is possible. We doubt if standardisation is possible except for particular classes of goods where it would be in the interest of everyone and ought to be worked for."
Their point 115, on page 308 says:
"Neither simplified language, standard form agreements, nor larger print would markedly restrain the over-persuaded or impetuous hirer from undertaking imprudent obligations."
I do not agree with that. I am quite convinced that it would be possible to make simplification in these agreements, and I think it would be possible to have more standardisation. I am wondering whether the Government would feel able to look at this, because, as the Minister will remember, and as I have just said, Molony states:
"We doubt if standardisation is possible except for particular classes of goods where it would be in the interest of everyone and ought to be worked for."
I would ask the Minister whether he could tell us in which particular classes of goods such standardisation would be possible, and whether the Government will look at the whole question. This is not a feeling of mine only. I have talked to a good many consumer organisations
1172
about this, and there is a feeling that this simplification could be achieved if the Government would have a look at the matter.
Now I come to something which I think is of very great importance, and which many of us have been trying to do something about for a great many years, and that is the matter of advertisements. This is covered by Clauses 27 and 28. I am quite sure that the whole House and, in particular, the noble Baroness, Lady Elliot of Harwood, will agree with me that nothing is more important than these advertisements from the consumer's point of view. I am wondering whether the Minister, when he come to reply, can spell some of these details out for my benefit, anyway, if not for the benefit of the House. Is there any way, when this Bill becomes law, by which hire-purchase firms can avoid letting the customer know the full hire-purchase price? If so, I want this made impossible.
I have tried very hard, reading this clause about advertisements, to see what it really means, and I should like to put to the Minister an example of an advertisement under the Advertisements (Hire-Purchase) Act, 1957. This is purely a fictitious one and no allusions to any current advertisements are intended. We might get: "Cash price £100; deposit £10; balance by 24 monthly payments of £4 2s. 6d." Amended by Clause 27 of this Bill we get: "Cash price £100"—which is the same—"Deposit, £10", and we get the addition, of course, of "Hire-Purchase Price £109; balance by 24 monthly payments of £4 2s. 6d." As the House knows the type of advertisement which I have just quoted is a "details of payments" advertisement. As I undertand it, the second type of advertisement, under the Act of 1957, as amended by the present Bill, in which the trader wishes to quote a rate of charge, would contain exactly the same information as the example I have just given, plus the charge which would then be shown as, in this example, 9·3 per cent. I would only add my remarks to those of my noble friend Lord Peddie and the noble Lord, Lord Airedale, and say that people who are much more knowledgable than I am and who have worked out this 9·3 per cent. for me were even more rude in their comments about

1173
the formula than was either of the noble Lords to whom I have referred.
The third type of advertisement, I gather, is a "non-details of payment" advertisement. As I understand it, a "non-details of payment" advertisement can say—and I quote an example—"Our hire-purchase terms, deposit, 10 per cent. of the cash price, balance by 12, 18 or 24 monthly instalments." I believe that I am correct in saying that if this present Bill becomes law it will make no alteration in practice to the information which is required to be given in a "non-details of payment" advertisement. I am rather labouring this point because I feel that it is quite obvious to everybody, whether engaged in the hire-purchase business or not, that if the hire-purchase price has to be stated on an advertisement the obligation should apply to all hire-purchase advertisements or to none. I do not think there can be a loophole.
What I am really asking the Minister to tell me when he comes to reply is, first of all (and it may be an ignorant query; I am quite prepared to admit that): Why is it necessary to have "non-details of payment" advertisements? Secondly, is that type of advertisement any real help to the customer? Thirdly, is it as much help as a "details of payment" advertisement? In the debate on January 31 last, I raised with the House something which the noble Lady has also raised to-day, and that was this question of a true measure of damage clause. I am not altogether happy about this matter. Without being tedious, or as we said in another place (I do not know whether we say it here), wishing to be guilty of tedious repetition, might I say that considerable sums of money are involved in this, and I think that we, as laymen, might try to find an answer to the problem. I think we all agree that real progress will not be made in this matter of consumer protection unless we are fair to both sides. I am not convinced that what is suggested in the Bill is equitable.
I am informed that the Memorandum on Hire Purchase submitted by the Law Society to the Board of Trade included the opinion:
"That in all cases where the owners seek damages against the hirer after the agreement
1174
has been terminated, the damages should be confined to his true loss in accordance with the Common Law principle …"
The view of the hire-purchase organisations, as I understand it, and certainly the view of the Hire-Purchase Trade Association, is that one should go further than this. If I am correct in assessing their attitude I would be prepared to agree with them. I think their attitude is that it should be made a statutory duty on an owner to repay to a hirer any excess which he may receive into his hands as a result of the sale of the vehicle. That is, of course, an excess over and above the hire-purchase price, and any sums which he may reasonably have to expend in regard, for example, to the sale of the goods.
I agree with the viewpoint expressed by Molony that the arbitrary 50 per cent. rule achieves a certain rough justice in ordinary consumer items. As I did during my many years in another place, I discussed these matters with the Hire-Purchase Trade Association; and I should like to repeat what I said in the last debate, that when I took problems from my constituents to them I received from the Association complete fairness of treatment even when finance houses were involved. I raised this matter with the Association and I know that they feel that in such cases, that is, where the arbitrary 50 per cent. rule applies, the advantage still lies with the consumer but that the damage to the owner is comparatively small owing to the relatively small sums involved. I gather they have been prepared to take this point of view because of the simplification it permits.
I have not sufficient detailed knowledge to comment on that, but I think it is right we should look again at this matter in connection with motor cars. As the Member of Parliament for Coventry, South I had a lot of experience with motor cars. I want to see justice being done on both sides. I would suggest to the Minister that where the loss to be suffered by a hirer who decides to terminate the agreement, especially at a very early or very late stage, or the damage suffered by an owner in other circumstances, may well be very great, I would tend to accept this. Therefore, on this point I should like to return to what I said on January 31: that unless,

1175
in respect of motor vehicles, provision is made so that, on the one hand, hirers are required to pay no more and no less than the actual loss which the owner has suffered, and that, on the other, owners are entitled to claim only their loss and are compelled moreover to repay any surplus arising on the sale of the vehicle, grave injustices will occur both to hirers and owners. I personally hope that the Government will feel able to look again at this matter. I repeat that I think we want to be fair to both sides of the counter—whether it is with goods in shops or with motor cars—and I feel, though obviously it is my opinion only, that further consideration of a "true measure of damage" clause along the lines I have suggested would meet with the approval of most people, with consumers, with traders and with finance houses alike.
I should like to make two points in conclusion. First, according to the Press the finance houses have said that if this Bill becomes law they will have to become more careful in their selection of customers. Personally, as other speakers have said, I cannot think of any better result than this. Useful though hire-purchase is to many people, I think there is little doubt that one of its greatest drawbacks is that some customers have taken on far too many commitments and have then found they cannot keep up with the payments, especially if they fall upon hard times.
The second point is this. Is there any reason why hire-purchase firms should wait until the Bill finally becomes law before finally implementing, say, the clause dealing with the "cooling-off" period? I feel that this "cooling-off" period is something that will benefit the consumer and help to curb the disreputable side of doorstep, or direct, selling. Certainly we intend to put it into operation as soon as the necessary printing can be done, early in the New Year. We hope that all hire-purchase firms will do likewise.
I wish the Bill well and I would appreciate it if the Minister in his reply could deal with the points I have raised. One, are there likely to be major additions to the Bill from the Government? Two, would the noble Lord consider extending the "cooling-off" period
1176
to all hire-purchase agreements? Three, will the Government look into the possible standardisation and further simplification of agreements? Four, can we have a clarification of the advertising position? Five, will the Government consider the merits of a "true measure of damage" clause? I thought that if I repeated the questions at both the beginning and the end the Minister would not forget them. It seems to me that such considerations would improve the Bill.
6.7 p.m.
LORD CHORLEY: My Lords, like the other Members of your Lordships' House who have been taking part in this discussion, I welcome the Bill, which, I agree, effects noticeable improvements in the present law which, I agree with the noble Lord, Lord Peddie, are mostly very much overdue. The passing of the years has of course made the 1938 Act in some ways a little out of date, particularly from the point of view of the inflation which this Government have signally failed to deal with satisfactorily. Also, of course, the much greater profits which are now made out of hire-purchase transactions have led to increasing ingenuity on the part of the rather less respectable type of dealer, which has, in turn, called for new methods of tackling him and preventing him from "getting away with it."
However, as one of those in the Haldane Society Committee who helped Miss Wilkinson with her original Bill, I like to claim that we have been doing our best to keep the Government up to the mark in the interval, and I was gratified that the Minister in his opening speech paid some tribute to Miss Wilkinson's work, which I always feel was really one of the most important pieces of social legislation which this generation has witnessed. The Labour Lawyers' Society incidentally, have recently produced a volume, Law Reform Now, which I think must have been carefully studied by Conservative Party Headquarters, because a good deal in the present Bill seems to emanate from that source, although I quite agree that much of it is in the Molony Report as well. But I think that, in turn, the Molony Report got quite a number of its ideas from the discussions which have been going on in the

1177
Haldane Society and in the Labour Lawyer's Society during these past years.
The interesting thing is that, until we approach the General Election, the Government should have been quite unready to accept these obviously useful proposals. Bills have been introduced into the Commons and we have had the Bill of the noble Lord, Lord Peddie, which was, for one reason or another, turned down. Now of course, when it may be thought that there is some electioneering value in having the Bill, we get it. It is not uninteresting to compare this with the much-quoted remark of the Prime Minister, that eyes must be on the General Election during all the coming months. The Prime Minister is evidently a student of Disraeli and believes he can entice the electors on to his platform by picking out the most suitable planks from the platform of his political opponents. I dare say he chuckles to himself and recalls the famous remark of Disraeli about catching the Whigs bathing and stealing their clothes. Perhaps the electorate has increased a little in intelligence in the interval and will see through this rather blatant plan.
Obviously we shall want to give a Second Reading to a Bill which contains so much of our own policy and the policy we were advocating long before the present Government took any interest in it. It is clearly in the public interest to get these useful reforms on to the Statute Book as quickly as possible and not delay over it, although I appreciate very much what the noble Baroness said about the importance of fundamental reform. We are really dealing with a method of selling goods, and it is very unfortunate that in order to protect the interests in property the whole of this system of hire-purchase law has, so to speak, been built up and in many ways is out of step with the general law relating to the sale of goods. I think almost every lawyer who has considered the thing in a general way would like to see the integration of the two systems. Many very valuable reforms have been laid down in connection with hire-purchase which could well he incorporated into sale of goods legislation, as indeed I think the Molony Committee appreciated.
At the same time, it is obvious that this Bill could have been made very much
1178
better. When the noble Lord, Lord Peddie, brought his Bill here, the Government in effect asked the House to reject it on the ground, as he reminded us this afternoon, that they were going to produce a really comprehensive measure. They have done nothing of the sort. They have just picked out the valuable vote-catching proposals and put them into this Bill, which, as I have suggested, is really being passed through in order that the Government may be able to pride themselves upon it when they go before the electorate at the Election next year. It shows many traces of having been prepared in a very great hurry. The noble Lord, Lord Peddie has asked why it was left out of the Queen's Speech. No satisfactory explanation of that has been given. Obviously, when the gracious Speech was in preparation it was not seriously proposed to bring in this Bill during the present Session. It is really quite impossible to persuade any sensible person that if it had in fact been on the stocks it would not have been put into the gracious Speech.
This view of the matter I think receives strong support from the fact that the Bill contains very important provisions, which have been welcomed and which I think are welcome, to deal with the problem of the hirer who gets goods when the dealer has not the full legal title to them, a very difficult and important problem, of course, in the whole law of sale. But the point is that the general aspects of this very important problem have only recently been submitted to the Law Revision Committee. It is quite impossible to imagine that these two things should be going on, as it were, in parallel with each other, because obviously there ought not to be any very striking difference between the law relating to hire-purchase in regard to motor cars and other branches of the law relating to sale, and it is most important that the law should not, so to speak, get out of step in one field with the law which is to prevail in the other field. The Government lawyers must have been aware of this, and yet their right hand does not seem to have known what their left hand was doing. I think it is very important that this matter should be looked at carefully by the Law Revision Committee, and the time we have between now and Committee stage should be used

1179
carefully in order to make quite sure that any important divergence in the law does not occur as a result of the proposals in this Bill, welcome as they may be in themselves.
All these provisions—for example, for "cooling off" (there is not much about "snatching-back" here)—are certainly good as far as they go. But if the Government had really been working on this problem, they would, I am sure, have produced proposals for tackling some of the real anomalies which exist in the present law. I should like to mention two or three of these. Others of them which have been much discussed since the Bill was published will perhaps be better considered in the Committee. That does not mean that I am not concerned with some of the provisions in the actual Bill which is before the House this afternoon.
There is the £2,000 figure which the noble Lord, Lord Peddie, has discussed. There is quite an important point in regard to the bringing of actions within the jurisdiction of the High Court which, as he said, is much more expensive and a rather slower procedure. So far the county court has dealt with these cases. There are provisions in various Acts of Parliament which give the county court special jurisdiction to a rather higher figure than they have in the ordinary way, and I would suggest to the Government that they should seriously consider giving the county court full jurisdiction in respect of all these hire-purchase cases. I think in company winding-up cases they have jurisdiction up to £2,000, and if the noble Lord consults his legal advisers I believe he will find there are other respects in which the county court has been given special jurisdiction over particular kinds of case.
There is this question of the very welcome power given to the Board of Trade to deal with signature and other matters in the hire-purchase agreement—size of print and colours. I hope that will be fully and carefully used by the Board of Trade. I should like to see (it may be that this is already in the mind of the Minister) a provision that the dealer should himself sign a statement to the effect that he has fully explained the terms of the hire-purchase agreement to the hirer. That might indeed specify the particular points which he should, so to
1180
speak, guarantee. And while we are on that matter, I think it would be very useful that certain parts of these points, such as the one suggested by the noble Baroness, should be incorporated in the Agreement in letters of a certain size. Too many of these agreements, or large parts of them, are in extraordinarily small print. Even with a "cooling-off" period of three or four days, it might be difficult for the householder and his wife to master the small print which appears in some of these agreements, and I think something could be done there.
In regard to the "cooling-off" period, I would ask whether 74 hours is sufficiently long. There are many workmen who are away the whole week—long-distance transport drivers and men who go away to do structural work, and that sort of work. It may easily be that the four days will have been consumed before they get home and discover what the wife has done. So I think there is some case for extending this to an even longer period than the four days, which I agree the Molony Committee proposed.
To turn to some of the other more legal points, I think it is no disparagement to Miss Wilkinson's measure to say that it has given rise to a number of very difficult legal problems. Bills which have been constructed from the beginning by expert Parliamentary draftsmen have often done that. Of course, this particular section of the law is a growing point of the law, and English law grows through the decisions which are given by the courts in specific cases relating to difficult points. This is also an area of the law where there are usually three parties concerned—the hirer, the dealer and the finance company. It is my experience that in legal problems the complexity seems to increase in a sort of geometrical progression with the number of parties involved. The legal periodicals of recent years, as those of us who have to study them know only too well, are full of discussions on the cases which have been coming before the courts on hire-purchase contracts, and reflecting the often conflicting decisions which have come from the courts on these difficult cases. This law is what we call lawyers' law, but it is not the less important for that; because uncertainty is bad, especially from the point of view of the business angle, and it leads to a great

1181
deal if litigation, which is expensive and, as has been said, time-consuming.
I could give many examples to illustrate what I have been saying. Some of my colleagues in the Law Faculty of the University of London have been greatly exercised on these matters, particularly since this Bill appeared, and in particular, if may mention one name, Mr. Aubrey Diamond of the London School of Economics, who has been playing a most important part in the consumer protection movement and who is, I think, a member of Lady Elliot of Harwood's Consumer Council. He and one of his colleagues have provided me with a sheaf of most valuable material on this subject, upon which I could talk for much longer than your Lordships would like me to do. I should, however, like to mention just one or two points.
The problem of compensation on the termination or breach of a hire-purchase agreement, and a matter which is greatly mixed up with it, has been referred to by more than one speaker to-day—namely, how far the parties can themselves effectively provide for the ascertainment of this without getting themselves involved in the intricate legal laws relating to what I call penalties. These matters have been before the courts in a number of cases in recent years, and only last year in the case of Bridge v. Campbell Discount Company, two Members of your Lordships' House doubted an important decision which was given by the Court of Appeal as long ago as 1938 and has been acted on ever since. This, as your Lordships can imagine, has caused a great deal of uncertainty, because the Court of Appeal decision stands until it is overruled. This is just one example of a number of other cases of a rather similar type.
It is not only a question of what is technically the correct rule—what would be the most equitable and fair rule to lay down; it is a matter which, in the end, can be decided only by the Legislature. That is why I feel this is a matter which ought to have been given much more careful consideration before this Bill was introduced. We want a genuine improvement in the general law relating to hire-purchase rather than just an improvement of the Conservative Party
1182
prospects at the Election, which, as I have said, is what this Bill to a substantial extent is directed towards.
One of the most extraordinary features of the present situation is that, under the decisions given on the 1938 Act, the hirer who determines his agreement lawfully is actually in a worse position than one who terminates the agreement unlawfully. Moreover, whether he has terminated the agreement lawfully or not may be an exceedingly difficult question of law on which different views can be given—and, indeed, have been given—by the courts. So much is this so that, as I understand it, some of the finance companies have a clause in their agreements by which the hirer agrees that any determination by him shall be deemed to be lawful. This puts the finance companies in a better position than if in fact he terminates his agreement in an unlawful way. This really is a quite ridiculous situation and it shows, I think, beyond a peradventure how necessary it is that some of these legal points should be cleared up. Recently, within the last few weeks, the case of Baldock has introduced a further difficult refinement into this particular problem, so that the complexity is worse than it was at the beginning of the year. It would be too difficult and complicated for me to explain it at this time of night.
To a large extent these difficulties stem from Section 4 of the 1938 Act, which attempted to protect hirers in respect of paying exaggerated compensation, by removing the ordinary Common Law rule in relation to the actual damage, to which the noble Baroness, and I think other speakers, too, referred. On the whole, I believe that most experienced lawyers consider that it would be better to repeal Section 4, and to leave the question of compensation generally to be settled according to the normal Common Law rules, instead of, as happens now, applying the Common Law rules only in some cases. It is not a question of this rather special rule being applied always. Often, it is difficult to know whether you are going to apply the Common Law rule or whether you are going to apply the rule under Section 4. I think that most lawyers would agree that it is better to repeal Section 4 and to start again. I must say that the Molony Committee's remarks on this point, which

1183
were referred to by the Minister, are rather superficial. I find myself in full agreement with what the noble Baroness who preceded me said about this.
May I say one word about the "snatch-back", which has not been much referred to this afternoon except in a quite general way. It was, as the Minister said, one of the basic features of the Wilkinson Bill. The present Bill leaves it on the one-third payment basis. The interesting thing is that in Scotland this has never been the rule. You can go to a court in Scotland and get protection long before you have paid one-third of the purchase price. What is going to happen is that the people in Scotland will be deprived of this valuable rule and brought into line with the English. While I agree that in general it will be useful to the people in Scotland to have the English law on this particular subject, it seems to me that the one-third payment rule is not at all satisfactory; and now that the ceiling is raised to £2,000, the amount involved—one-third of £2,000—is a large sum of money. Quite obviously, the depreciation on these valuable motor cars and articles of that kind is nothing like that within a period of quite a number of months, and I personally should much prefer to see the Scottish rule incorporated into the English Bill, rather than vice versa. I hope that those who protect the interests of Scotland will have something to say about this aspect before this matter is decided.
There are many points of a similar kind which could be raised, some of which I hope will be raised on the Committee stage. We have quite a long time before we reach the Committee stage, and I hope that it will be possible for the Government and their lawyers to look into this Bill a little more carefully. From time to time I have very much regretted that we have not had the assistance of the legal Members of your Lordships' House on such Bills as this in which intricate and difficult problems of law are involved. I would suggest that there might be some sort of informal discussions, such as were held at the time of the 1948 Companies Act on the accountancy aspect of the Act. That aspect was worked out informally in a Committee presided over by the late Lord Jowitt, the Lord Chancellor of the
1184
day. There are so many points on which this Bill could be improved in that sort of way that I would commend to the Government the idea of initiating discussions of that kind. This is a Bill which hits citizens all the time, and it ought to be made into as good a piece of legislation as is humanly possible.
6.30 p.m.
LORD SHACKLETON: My Lords, I desired to speak in this debate only to declare an interest as a simple member of the retail trade who welcomed the Bill. Indeed, by the time the noble Lord, Lord Drumalbyn, had sat down—and I should like to add my congratulations to those of other noble Lords—I felt that I understood all I needed to understand about the Bill. But, as the debate has gone on, I have found the waters lapping higher and higher until now they are clearly over my head. It now seems that it would have been much simpler to pass the Bill of my noble friend Lord Peddie because the present Bill is so imperfect that it ought not to leave this House.
I have not attributed any very wicked motives to the Government in regard to this Bill, but I realise that they are a very wicked Government and the view of my noble friend Lord Chorley that this is a pure electoral trick may have quite a lot to it. But we also recognise that this is a desirable Bill because it is important that some of these abuses should quickly be put right. I congratulate my noble friend Lord Peddie on his influence in bringing this about. I still do not quite understand the attitude of my noble friend Lady Burton of Coventry. I will not start re-debating, as she wanted to do, Lord Peddie's Bill. There was some justification for being doubtful about the Government. For years and years we waited for a Shops and Offices Bill, and it was not until a Private Bill had gone through that we got it. Then, interestingly enough, they waited over the period of a General Election. They did not think that was such a good Election winner as my noble friend Lord Chorley suggests this Bill might be.
Clearly this is a Bill which will be welcomed by all reputable traders; indeed, I have heard little criticism of it in the trade. I was interested by the arguments and the points made by my

1185
noble friend Lady Burton of Coventry. I shall be interested to hear the Government's arguments on those points, but I am quite sure that this Bill goes as near to the heart of the matter as can be dealt with in a limited measure. The speech of my noble friend Lord Chorley suggests that some more profound legislation is necessary, something which would clearly provide a lawyers' benefit for many days to come in both Houses of Parliament. I think that it is quite likely we shall be able to make some improvements to this Bill. I do not think it is necessary, as my noble friend Lady Burton of Coventry suggested, to extend this into retail premises. I am not suggesting that abuses do not occur, and it may be that a reputable trader is very much unaware of what goes on. The honest, reputable trader is not anxious in a shop, whether it be private enterprise or co-operative trading, to enter into unsatisfactory transactions of any kind—for the simple reason that he hopes to continue holding his customer, whereas the door-to-door salesman may not be in quite the same position.
I was interested in some of the points made about the nature of the actual contracts, and I should not have thought it beyond the power of the Government—though it probably would be beyond their power—or at least beyond the power of the legal profession, to agree on the standard forms urged by Lady Burton of Coventry. There are standard clauses for all sorts of things, and perhaps this is something in which the Consumer Council might bring a little pressure to bear. For all I know, there may already be a large measure of standardisation in this field. There is much to be said for this, and, as I have said, this is a matter on which the Government or the Consumer Council might use their influence, even if it is not incorporated into legislation.
I have only two other points. The first concerns the question of confirmation. As I understand it, the burden of proof will be upon the hire-purchase firm to prove that they have posted the contract. It would seem that recorded delivery will be a necessity if they are to show that they have posted it. I am not sure about this, and this is something upon which we can reasonably expect an answer to-day. I do not think
1186
we shall ever get this right to everybody's satisfaction. I think that four days is about the right period, although I do not disagree with the force of the argument of my noble friend Lord Chorley. But four days appears to be reasonable, if we are ever to get any business done at all. We do not want this sort of legislation to become a total obstruction of business.
My other point is this. If one has bought a motor car on a hire-purchase arrangement and is given one of these cards instead of the registration book, what happens when one goes abroad? I believe there are some situations in which it is necessary to produce the registration book. Are the Government opening negotiations on this point, through the international motoring organisations or the Board of Trade? Again there may be a single answer. It will be most irritating to be held up because one has not the proper document for the purpose. In general, I agree with my noble friend Lord Peddie and with those of my noble friends who have welcomed this Bill. It will certainly greatly reduce the number of really distressing stories, many of which were related on the last occasion we debated this matter, and the sort of cases with which we are familiar. There has been gross abuse in the field of hire-purchase, and this Bill goes quite a long way towards solving some of the problems.
6.38 p.m.
LORD REA: My Lords, I shall keep your Lordships for only a few moments. I wish to give myself the pleasure of congratulating the Minister on a most interesting and extremely clear speech covering a very wide field. I also should like to confess some interest—not a present one, but one in the past. During the ten years before the war I was concerned in car hire-purchase and took my turn as chairman of the Society of Motor Manufacturers' hire-purchase section, which has now become a finance house association. The Minister told us that the bulk of hire-purchase related to motor vehicles. I would point out that, on the whole, as a trade they do not deserve all the slanderous things which are said about them in regard to hire-purchase. In the first place, I know of no respectable motor hire-purchase company which ever sends

1187
any salesmen on to a doorstep. That sort of selling is done by shops and retailers.
LORD SHACKLETON: My Lords, what does the noble Lord mean by "shops and retailers"? If he is defending his own house, he must be precise as to whom he is attacking.
LORD REA: I am only quoting instances from the last debate. I quite agree that the responsibility rests with the finance houses to be as selective as they can, and I can assure your Lordships that responsible ones are extremely selective and do take up very careful references before they enter into agreements. Indeed, the usual thing is for a proposed hirer to fill up what is called an application and agreement form, so that inquiries can be made on the basis of details given in the application. That wipes out the necessity for any "cooling-off" period for the hire-purchase company and they can select on the information received.
In the case of banks, if the hirer has a bank, they are good enough to give very short, terse answers. I believe that banks have only three answers to an inquiry: the first is "Undoubted", the second is "Should be good", and the third is "Cannot speak". But the trade references give a much clearer picture of the general reliability of the proposed hirer. I remember one rather unusual one which came into my hands, which said merely,
"This lady is guilty of over-oiling causing her throttle to advance",
and we took particular care with that case.
I rose merely to say that there are highly respectable finance houses which have practically the same status as banks, or merchant banks, and that the real scandals occurred mostly in the old days and for very small items. With those few words, I should like to say that I support the Bill and I hope it will receive a Second Reading.
VISCOUNT STONEHAVEN: My Lords, I want merely to congratulate the Minister and to ask him a question now, as I do not want to interrupt him later when he replies. May I ask him whether or not Olympia, Earls Court,
1188
and any other places where exhibitions, such as all the agricultural shows, are held, and where a great deal of trade is transacted, come under the heading of "normal trade premises"? Could some clarification be given on that point?
6.42 p.m.
LORD SHEPHERD: My Lords, all noble Lords who have taken part this afternoon in this debate have expressed their appreciation and their congratulations to the Minister, and I am sure that those who have not taken part would also wish to be associated with those comments. It must be very gratifying to a Minister to move in a maiden speech the Second Reading of a Bill which receives wide acclaim from all quarters. I hope that the Minister will be as receptive and forward-looking on Monday, when I raise another matter of consumer protection—namely, stamp trading. I hope he will be receptive and will listen to all the points that will be made. My Lords, time is running a little beyond what we had originally intended for to-day's Business, and therefore I will be brief. I have already asked the Minister's forgiveness if I should have to leave before he finishes his speech, and perhaps the time might equally explain the rather empty spaces behind me. I have three points to make. First, I am sure that the Minister will agree that this is a complex Bill and not easy to understand. It needs a great deal of careful attention and on many points, I think, legal advice. Therefore I hope that the Government will give us reasonable and ample time between this stage and the Committee stage. I think there are many on all sides of the House who are interested in consumer protection. As my noble friend Lady Burton of Coventry has said, we wish to see justice done not only to the consumer but to those who are in the business, and we should have ample opportunity not only to consult each other and our colleagues in another place, but also the many outside interests which are involved. I would draw the Minister's attention to the fact that we shall shortly be adjourning for Christmas and, as he well knows, it is very difficult to find anybody to talk seriously on any matter during that period. I therefore hope that he will try to persuade the

1189
usual channels on his side that we should have the Committee stage in, perhaps, the second week after our return. I think that this is a case where less haste will in the end mean more speed, and I hope that the Minister will do his best for us.
In regard to what is called the "cooling-off" period, of course I thoroughly agree that there should be this period during which the person who is entering into a hire-purchase agreement in his home, perhaps under pressure, should have time to think about it. But are we not, in fact, creating a very new principle in law? As I understand it, once a contract is signed, it is valid and cannot be broken unless there is the consent of the two parties. But what the Government are proposing is that the contract may be broken unilaterally by one party. I fully accept the reasons for this, but I suggest that we should not regard the document that the person may sign in his home as the contract, but should regard it merely as a notice of intention; and it should not be binding either on the hi re-purchase company or on the individual. Then the document to which the noble Lord the Minister referred—the one that is sent by the hire-purchase company to the individual in his home—would be the contract. The individual who is undertaking the hire-purchase agreement would then sign the document, tear off part, perhaps, and return it to the hire-purchase company. There would then be this period that we all want. It would mean the conscious effort in signing a contract free from any influence and, above all else as I see it, it would not raise many long-term questions about the validity of contracts.
I do not think my suggestion would create a great deal more work for the hire-purchase companies, and in many respects it would give greater protection to the individual and more time for thought before entering into a hire-purchase agreement. Like many of my noble friends, I wonder whether the mere posting of a cancellation is sufficient. If the Government believe that they should go forward as proposed in this Bill, then, in fairness not only to the individual who has entered the contract and wishes to break out, but also to the hire-purchase company or the agent, who may be a shopkeeper, I believe that
1190
the notice of cancellation should certainly be sent by recorded delivery or registered post. There would at least be some evidence that some matter had been sent through the post. As I see it, with the Bill as now drafted there could be considerable dispute, because you may not always be dealing with an efficient hire-purchase company recording incoming mail, and you may be dealing with a small shop which has very little administrative facility or knowledge of it.
My Lords, I would emphasise, particularly, the point that was made by my noble friend Lord Peddie in regard to the county court. I think it would be highly undesirable that, because we have raised the limit to £2,000 we should put the claimant, either an individual or a hire-purchase company, in the position of having to go to the High Court, involving not only delay in having the case heard but undoubtedly considerable extra expense. I understand that the county courts already take other items into their consideration, where there is a higher value than £500. I would therefore ask the noble Lord whether he would consider an Amendment to the Bill, to see that matters relating to this proposed legislation will be dealt with in the county court.
I have one last point and, because of his nationality, the noble Lord the Minister may be able to answer. I think it is recognised that some of the worst abuses of hire-purchase agreements are taking place in Scotland. It was put to me last night by a friend that there have been occasions where a person has been sick, perhaps on the point of death, and has called for a guarantor to guarantee the payments under a hire-purchase agreement. The person has died, and the hire-purchase company has taken back the goods; yet the guarantor, because he has guaranteed the hire-purchase agreement, continues to pay. My Lords, obviously under this Bill such a situation will not arise in the future, but I hope the Government will consider whether this particular part can be made retrospective, so that we can remove the obligation on such guarantors to continue payments even though the goods have been returned.
My Lords, those are the points that I wish to raise this afternoon. The noble

1191
Lord the Minister will appreciate that there will be much that we shall want to discuss on Committee stage. I think this is a type of Bill with which this House is eminently suitable to deal. We have the noble Baroness opposite, with all her vast experience, now on the Consumer Council, my noble friend Lady Burton of Coventry behind me, and many other noble Lords in all quarters of the House who take an interest. I therefore look forward to a lively and, I hope, constructive Committee stage, but above all I look forward to finding the Government very receptive to our pleas.
6.52 p.m.
LORD DRUMALBYN: My Lords, my first task, I think, is to express to all those noble Lords and noble Ladies who have welcomed me personally to these debates my great appreciation of the way in which they have done so. I admit I am extremely fortunate in having had the opportunity to make my maiden speech on an occasion when I am presenting a Bill which seems to be, in general, universally acceptable. I should like to thank also the noble Lord, Lord Peddie, for the way in which he not only welcomed me to this Despatch Box but also welcomed the Bill.
It may be convenient, in view of what the noble Lord, Lord Shepherd, has said, if I just say a word or two in reply to him first. The first point he made, about ample time before the Committee stage, is, as he appreciates, not one for me, but I will certainly pass on to my noble friend Lord Carrington what he has said. On the subject of contract, I well understand the difficulties that he experiences in this regard, but, in the nature of the case, where we are talking of the "cooling-off" period, the document originally signed by the potential hirer is more in the form of an offer than in the form of a contract in its early stages. It does not become an agreement until that offer is accepted by the finance house. The finance house then sends back what is, in effect, a draft agreement for four days. I am not learned in the law, but I should have thought that it only certainly became a contract when the period for reconsideration, the "cooling-off" period, had elapsed. If I am wrong in that, we can certainly consider it during the Committee
1192
stage. The noble Lord, Lord Shepherd, also raised the question of whether the Bill should be retrospective. This is a point I should like to consider, but I believe the position is that all existing contracts within the limits established will be brought within the purview of the Bill in respect of the particular sections of the Act mentioned in the Bill. There is a clause in the Bill which deals with this.
The noble Lord, Lord Peddie, treated the introduction of this Bill as a sinner welcomed because of his repentance. But I must say to him that I think he almost exaggerates the capacity of the Government to do miracles in a very short time. The fact is that while it is perfectly true that the Bill was not mentioned in the gracious Speech, and while he presented his Bill on the following day, it was on the very next day, if my memory serves me correctly, that my right honourable friend made the announcement that we were going to introduce this Bill, and it was only fourteen days later that this gigantic Bill was laid. If he thinks it is possible to prepare a Bill of this kind and to go through the various consultations required in fourteen days, then he must consider that this Government can perform even greater miracles than they can.
LORD PEDDIE: But the Minister in another place has given a clear indication that those consultations never took place.
LORD DRUMALBYN: With respect, the consultations have been going on throughout the time since the Molony Committee reported. If I may remind your Lordships, the Molony Committee was appointed in July, 1959, and it reported in July, 1962. I think it would have been too much to expect that a Bill of this character could have been introduced at the beginning of last Session, and really this is the first opportunity that it could have been sensibly introduced. I hope that, that being so, it will not be regarded as any kind of last minute defence, but a very calculated and very carefully studied Bill indeed. The noble Lord, Lord Chorley, said that he had found a great many—I think he said—inaccuracies, or a word of that sort, but he did not venture to refer to any of them. Perhaps we shall get them when we come to the Committee stage.
LORD PEDDIE: My Lords, though one may accept the explanation the noble Lord has made, I wonder whether he would give some indication of the reason why the Bill was not mentioned in the gracious Speech, in view of the fact that the statement is now being made that the Bill was already in existence.
LORD DRUMALBYN: My Lords, there is no need to mention in the gracious Speech all the legislation that is coming forward, and there can be a great many reasons for not putting it in. One I may mention right away is that, for example, it may be that there were one or two points outstanding that had not been decided upon—and that is sometimes quite a good reason for not mentioning a Bill in the gracious Speech.
I come to the next point that I think the noble Lord, Lord Peddie, made—and it is a point that was also referred to by other noble Lords—and that is as to the court in which will be considered those cases which, when they arise, will exceed the normal purview of the county courts. I think if he looks at Sections 11 and 12 of the principal Act he will find that these cases are cases which are to be taken in county courts; and that, I am informed, covers the cases that will emerge, despite the increase in the limit, just as much as the cases below the normal limit for county courts.
The next point that he raised was the question of postage, and it is a point which was referred to by several other noble Lords. Surely the principal object of the provision here is to enable a fixed time for reconsideration (for "cooling-off", if you like) from the time of receipt of the agreement by the potential hirer until the time when he must post. This is the essential thing; and the great advantage is to give the hirer a fixed time. I should imagine that, if there is a dispute as to when he actually posted it, this would be a matter of evidence and proof in the ordinary way. But, again, this is a matter we can consider in Committee, if noble Lords have doubts about it on further consideration.
On the question of registration of log books, perhaps I may say this right away to the noble Lord, Lord Shackleton, because it is undoubtedly a matter
1194
which is of very wide interest. He raised the question of what happens to the licensing card so far as those who are purchasing their cars on hire-purchase and wish to take them abroad are concerned. Licensing cards will be as acceptable as registration books now are. What is really needed is an identification document; and a card will serve this purpose just as well as a registration book now does. I do not think any difficulty arises there. On the more general question of consolidation, one can look forward to consolidation but I should have thought—
LORD PEDDIE: My Lords, I hope the noble Lord will pardon this interruption. Before he leaves the point with regard to cars, I wonder whether he can give some indication of how he would deal with the retrospective aspect where log books are held by individuals who transacted hire-purchase prior to the passing of this Bill.
LORD DRUMALBYN: What the noble Lord said is quite correct. There is no obvious way to deal with this, and if he makes a suggestion we should be grateful. This is why I laid considerable stress on the facilities that are available through the register kept by finance houses themselves of all cars which are subject to hire-purchase contracts; and the facility that is available for any person who wishes to buy a car through hire-purchase to make application through the motor organisations or a citizen's advice bureau. He mentioned the question of emergency powers. I would only say that this question of hire-purchase controls is really quite a separate matter. This is a matter of economic controls coming under the emergency powers which lapse in any case in 1964, and naturally Her Majesty's Government are considering this whole subject at the present time. I would agree with a great deal of what he said as he is good enough to agree to what I said.
It seems to me that a great advantage of this Bill is that it will do two things: it will simplify to a considerable extent and it will cause finance houses to look more carefully at contracts, at potential customers and their dealers. I think the noble Lord said that greater selectivity will mean lower costs. We all

1195
hope for this and I think it will be the case. The finance houses may well find their costs, so far from going up, may even prove to go down.
I come now, my Lords, to what the noble Lord, Lord Airedale, said. He made some very interesting suggestions which I think we can consider in Committee with regard to the hire-purchase agreements, and the suggestion that we should insert into the hirer's copy of the agreement the rights and duties under Clause 6. As to the "cooling-off" period, I was not really certain whether he was asking for a "cooling-off" period for the finance house or for the dealer. There has been a certain amount of not unnatural confusion in the course of the debate, which is inherent in the nature of hire-purchase contracts, between the dealer (who, in a sense, is doing the selling) and the finance house which becomes the owner and is in effect in the end the person who is selling to the hirer under a hire-purchase contract.
I was not quite clear as to what the noble Lord had in mind; but I think it is worth while pointing out that in any case a copy of the agreement has to be sent to the hirer within seven days and this is in itself a very useful safeguard for the finance house and, indeed, for the dealer as well. The agreement has to be sent within seven days, and therefore gives a certain amount of scope for the acceptance or rejection of the offer that is made.
LORD AIREDALE: I thank the noble Lord very much. I was pleading for an opportunity for the finance house to make inquiries in cases where they suspect that the hirer is already heavily committed on hire-purchase transactions and may not be able to afford yet another.
LORD DRUMALBYN: My Lords, in that case it is open to the finance house to refuse the business. I should have thought this was quite a useful safeguard in itself.
My Lords, we have had two most interesting speeches from the noble Baroness, Lady Elliot of Harwood, and the noble Baroness, Lady Burton of Coventry. I should like to say to both noble Ladies how much I appreciated
1196
what they said about me. The noble Baroness, Lady Burton of Coventry, having put five specific questions to me, places me in a difficult position. Perhaps I could deal quickly with one or two of them. She asks whether we can hope for additions to this Bill before it becomes law. If any improvements can be made in the course of this Bill's passage we shall all welcome them; but if she means: Is it likely that we shall be able to overhaul the whole hire-purchase system and add these Amendments on to this Bill?—then I am bound to say that I think that that is unlikely.
She also asked about the "cooling-off" period for all hire-purchase agreements. I think this is the core of the limits we are putting on the additional protection—the "cooling-off" period. I ought to say that there is in my mind a very strong distinction between a person who goes out in search of goods, or at any rate goes into a shop with the object of buying goods (and probably knows before he goes whether he can afford to pay the full price right then or will have to buy on hire-purchase), and the person who is visited in his own home. It is better to make this distinction. It would immensely increase complications if we were to extend it to all kinds of transactions. Indeed, I think this cannot even be restricted to hire-purchase contracts, as such; but is a matter of whether you have time for reconsideration and that sort of thing whether you are buying on credit or cash; and is better dealt with under the Sale of Goods Act.
As to standardisation, the real difficulty is to find a kind of standardisation agreement that would cover all cases. We had looked at this and are naturally willing to look at any future constructive suggestions that may be made; but we have no evidence that to pursue a course of standardisation would result in greater protection for the consumer. It would need an immense amount of different kinds of agreements to cover different types of goods, and variations even for types of goods for various options open to the consumer.
As to the true measure of damages, a point raised by several noble Lords, this is, as the Molony Committee said, theoretically attractive; but surely it is better, as I said in my earlier speech,

1197
to allow both parties to know where they stand throughout the course of the agreement. There is always the objection that if, say, the car is handed back there will be a very strong feeling in the mind of the hirer who has handed it back that he has no real safeguard that the car will be sold to the best advantage. One cannot guarantee in all cases that the list of secondhand prices will be available; and that will be just as artificial and a good deal more unsatisfactory than that kind of clear-cut simple provisions in this Bill and in the legislation. I suggest to the House that simplification is one of the great virtues for which we should aim in this type of legislation.
I do not know whether I have covered all the points raise—
BARONESS BURTON OF COVENTRY: My Lords, could the Minister deal with the matter of advertisements and say whether it will be possible, when this Bill becomes law, to avoid stating the full hire-purchase price?
LORD DRUMALBYN: My Lords, the Advertisements Act is fairly specific on this. If goods are advertised at all, then the whole range of prices must be mentioned, and in this Bill we are adding the further provision that the full hire-purchase price must be stated, so that there cannot be any confusion on that.
BARONESS BURTON OF COVENTRY: My Lords, I gave the noble Lord three examples, and asked whether, if it was possible to avoid stating the full hire-purchase price, some companies might not disclose it.
LORD DRUMALBYN: My Lords, if a company advertises that it is prepared to sell goods on hire-purchase, then the advertisement must publish the full hire-purchase price. I think that is the best possible safeguard, in the circumstances. There can be no compulsion to advertise, but if there is advertisement, then the full hire-purchase price has to be shown.
LORD AIREDALE: My Lords, does that mean one could not have an advertisement which merely said, "Hire-purchase terms are available"? I
1198
should have thought that that was quite unexceptionable.
LORD DRUMALBYN: My Lords, if I may say so, these are really Committee points, and I think it would be wiser for the House to leave the Bill at this stage. I will certainly look forward to an interesting and searching Committee stage. In conclusion, I should like to thank your Lordships very much for the welcome they have given to this Bill.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

  NUMBERS OF GOVERNMENT MINISTERS
  NUMBERS OF GOVERNMENT MINISTERS